Compagnie de Financement Foncier’s assets are high quality and diversified, in terms of counterparty type but also in terms of geographic breakdown.Public sector
Public sector exposures consist of loans, commitments, liquidity guarantees and bonds that Compagnie de Financement Foncier finances at the best possible terms.
Specific components of public sector exposures
- Public authority exposures offer the highest credit ratings
- As of December 31, 2021, 39% of all the assets.
French public loans and securities
Compagnie de Financement Foncier may be exposed to the French public sector entities such as national government, local authorities or local government groups. These assets, loans and securities, are intrinsically of high quality since they are implicitly guaranteed by the French Government and indefinitely.
International public loans and securities
Compagnie de Financement Foncier is exposed to international couterparties meeting the eligibility requirements of the French Monetary and Financial Code. Prior to the phase-out that began in 2011 (the portfolio is now in run-off), loans selected for grant were concentrated on counterparties with the highest ratings, most of them Step 1 (AA-).Mortgage loans
A vast majority of mortgage loans acquired by Compagnie de Financement Foncier are residential mortgage loans.
Loans secured by a first-rank mortgage or equivalent guarantee are eligible when the underlying property is located in the European Economic Area or in a country with the highest credit rating
Residential mortgage loans characteristics
- in France: loans are purchased or refinanced with CFF
French residential mortgage loans
Residential mortgage loans have two distinctive features: 1) their purpose, which is to finance a housing purchase; 2) the mortgage, which enables the loan to be secured with the underlying property. The mortgage enables the lender to be paid from the sale of the property before other creditors if the borrower defaults. Loans are first originated by Crédit Foncier using a scoring method that considers the characteristics of the property to be financed, customer information and the historic probability of default.
A tool is then used to score residential mortgage loans and select those whose probability of default is below certain threshold and in some cases after an observation period.Asset breakdown