Crédit Universel : a regional champion of consumer credit

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Crédit Universel logo, BNP Paribas Historical Archives

Crédit Universel logo, BNP Paribas Historical Archives

Crédit Universel, a consumer credit institution founded in Marseille in 1955, has become a national leader in credit, leasing and factoring. It joined the Banque Nationale de Paris (BNP) in 1982, then BNP Paribas in 2000, through a series of mergers.

Let’s take a look back at the history of this often overlooked institution.

1955: Crédit Universel is founded

A concept originating in the United States

After reading an article about consumer credit in the United States in 1954, Joseph Biaggi set out to build a regional centre for financing credit sales, with the backing of the Altieri-Biaggi family business in Marseille. The desire to emulate the “American way of life” came in response to the emergence of a mass consumer society in the 1950s. In France, in the aftermath of the war and as the country was rebuilding, the pioneers in this field were Jacques de Fouchier in 1953 with Cetelem and Jack Francès in 1954 with Sofinco. But consumer credit still lagged far behind in France, and the bank at that point was then essentially only discounting.

The institution, initially called Société Phocéenne de Crédit, was soon renamed Crédit Universel, Société de Crédit pour l’Expansion Économique. Designed to be a kind of “financial drugstore”, it was meant for everyone throughout the country, with a wide range of products.

Comprehensive financing

Crédit Universel logo, BNP Paribas Historical Archives
Crédit Universel logo, BNP Paribas Historical Archives

The journey began in August 1955. The Altieri-Biaggi family held two thirds of the capital and relied primarily on the insurance company Union (the future UAP). The shareholder pool was rounded out by Banque de l’Indochine, Crédit Lyonnais, Comptoir National d’Escompte de Paris, Banque de Paris et des Pays-Bas and Compagnies d’Assurances Alsaciennes.

Biaggi envisioned a kind of “Swiss Army knife” company offering a variety of financing options for a broad range of customers: loans and leases for cars, boats, motorhomes, campers, commercial vehicles and trucks for private individuals, merchants, tradespeople and self-employed professionals; personal loans, leases on equipment, automobiles, light utility vehicles, trucks; real estate loans for companies offering business development, inventory loans, advances on financing, advances on commissions, factoring, overdraft allowance, chequing accounts, fixed-term accounts, savings accounts, savings bonds, bank bonds on a daily basis.

1961-1967: Crédit Universel grows

Implementation of a unique legal framework to host and develop all services offered

In 1961, a joint venture was created with the establishment of “subsidiaries” forming the Compagnie Universelle de Banque (originally Foncia-Crédit): Crédit Universel was dedicated to consumer credit for individuals and SMEs; Unifimo was a savings and credit union for real estate financing and a deferred credit company; Locunivers offered rental of automobiles, recreational boats and other equipment and loans; Locationfor was focused on rentals, and Universal Factoring on factoring. All these “subsidiaries” were partners of the group in their own right, each contributing to overall group turnover.

In January 1962, the Crédit Universel corporation and Crédit Universel were granted certification by the Banque de France, the former becoming the group holding company. That same year, Crédit Universel stock was authorised to be listed on the Paris stock exchange, and in May 1967 the head office of Compagnie Universelle de Banque was transferred from Marseille to Paris.

The group’s national ambitions were clearly on display.

Building facade in Paris, BNP Paribas Historical Archives
Building facade in Paris, BNP Paribas Historical Archives

1962-1982: rapid growth

Because the bank’s mission was to meet the needs of everyone, it was necessary to have locations everywhere. A network of agencies/branches was established: 20 in 1962, 57 in 1972 employing 620 people, for a turnover of 146 million francs.

1972: UAP becomes the main shareholder of the group

At this stage of development, the Altieri-Biaggi family resources no longer sufficed to ensure the institution’s growth, and UAP took a majority stake in the capital of Crédit Universel, which then merged with Compagnie de Banque. Growth was gaining speed: in 1980, the Group had 72 branches and 850 employees, with a turnover of 1.2 billion francs. Sales were made via branches or the network of representatives which included 12,000 partners in 1979.

1979: new products

In 1979, following deregulation of consumer credit, the group also started to offer personal and revolving loans. Consumer loans, leasing, revolving credit, personal loans and real estate loans were sold to private individuals; while short- and medium-term financing and real estate loans were available to companies. The banking business was maintained.

1982: joining the Banque Nationale de Paris (BNP) group

In 1982, the nationalisation of most of the banking sector raised fears of increasing competition from nationalised banks, while Crédit Universel remained private. BNP, meanwhile, sought to expand its consumer credit range and thus strengthen its offer for private individuals. These respective ambitions sealed their union: Crédit Universel became a subsidiary of the BNP group, which took a 66.69% stake in the Marseille group. UAP retained a stake of about 20%, while the Altieri-Biaggi family held only 6% of the capital.

BNP logo, BNP Paribas Historical Archives
BNP logo, BNP Paribas Historical Archives

A group known for flexibility, adaptability and responsiveness

With 850 employees, the bank had a solid position throughout the country: 75 offices divided into 48 bank branches, 18 credit agencies and 9 credit bureaus linked to agencies. This large network handled 277,000 customer accounts, with average monthly outstandings of around 250 million francs and annual production of 3 billion francs. It ranked fourth in France among specialised financial institutions, after Compagnie Bancaire (Cetelem, Cardif, etc.), Sovac and Sofinco, its closest competitors.
Its diversified business was handled 85% by intermediaries, with consumer credit accounting for nearly 50% (mainly for cars, then aircraft and campers). For the rest, housed in a group of specialised companies, the group offered corporate loans (investment loans or corporate leasing, car rental), real estate leasing and factoring, which it helped to develop in France.

Culture shock: a regional financial institution with national ambitions vs. a major group with international ambitions

However, in 1985, following the definitive sale of the Altieri-Biaggi family’s stake in the group, BNP increased its stake in Crédit Universel to 69.18%. The institution faced stiff competition from banking institutions and mutual society networks.

A well-managed company, but disrupted by market changes 

Crédit Universel’s business remained closely linked to the economic situation due to its major presence in car loans, with 40,000 vehicles financed per year. This expertise left it vulnerable to manufacturers who established their own financing entities. Starting in 1987, the bank was hit by the effects of the “credit squeeze”: amidst financial deregulation, deposit banks, like BNP group, could now offer individuals the full range of loans (housing and consumer loans) that were previously available only from specialised institutions.

1985-1987: business restructuring

BNP Group thus refocused the Crédit Universel strategy on credit through intermediaries (car loans, leasing, factoring, personal loans, deferred credit, credit savings) by significantly reducing its deposit banking activities. While Crédit Universel’s mission was preserved, its main majority shareholder sought to create business synergies in order to diversify its offer and build customer loyalty.

Highlighting its expertise and added value

Crédit Universel had to respond to these new challenges: it strengthened its image in the recreational sector, which grew by 15% (boats, planes, campers, motorcycles), and became one of the four leading French institutions focused on recreational boating. In 1987, it sponsored a young sailor in the Figaro solo race, who finished 6th in the competition.
At the same time, it grew significantly in the areas of professional and corporate financing, factoring and real estate: leasing and rental finance overtook traditional credit from 1986 onwards. Indeed, in an overall context of limited consumer credit, Crédit Universel’s financing for its BNP customers was a considerable asset, enabling it to build customer loyalty: leasing financing was handled by Locunivers, factoring by Universal Factoring and revolving credit by Crédit Universel.

BNP advertising proposing its consumer credit offer : "Notre filiale le Crédit universel peut apporter une solution à tous vos problèmes pour un financement personnalisé" (Credit Universel, our subsidiary, can bring you a solution to your problems with a customized financing), BNP Paribas Historcial Archives
BNP advertising proposing its consumer credit offer : “Notre filiale le Crédit universel peut apporter une solution à tous vos problèmes pour un financement personnalisé” (Credit Universel, our subsidiary, can bring you a solution to your problems with a customized financing), BNP Paribas Historcial Archives

Early 1990s: growth stalls

But almost ten years after its incorporation into BNP, Crédit Universel remained relatively small: 91 branches in 1990 for 335,000 customer accounts, which represented growth of just over 2% per year during the decade. Despite an increase in its earnings and operations, Crédit Universel’s structure had changed little: it developed only one international subsidiary, Credifimo, which was founded in 1984 in Spain with BNP España.

Streamlining the business: industrialising production and strengthening relations with BNP

At the end of 1991, Crédit Universel merged with BNP Bail, a 100% BNP subsidiary and heir to Natio Equipement, which had been created in 1972 and specialised in financing leasing, movable and immovable assets, and rentals. The two companies’ roles were redefined: BNP Bail was tasked with meeting the specific needs of BNP customers on leasing and rentals, while Crédit Universel was entrusted with consumer credit, leasing and rentals via intermediary for private individuals and non-BNP customers, thus returning to its original business. The leasing businesses were merged.

Crédit Universel, Marseille, boulevard des Dames, BNP Paribas Historical Archives
Crédit Universel, Marseille, boulevard des Dames, BNP Paribas Historical Archives

1994-2000: successive mergers

Restructuring continued, and in May 1994 BNP Factor SA was created as a result of the merger of BNP Factor SNC, a subsidiary of BNP Bail through Naciocrédit, with Universal Factoring, a subsidiary of Crédit Universel. The aim was to allow factoring, a loss-making activity for both entities, to grow. In 1995, Crédit Universel became a wholly owned subsidiary of BNP through Natio Crédit SA, with the dual status of bank and financial institution.

Crédit Universel in Marseille, office view, BNP Paribas Historical Archives
Crédit Universel in Marseille, office view, BNP Paribas Historical Archives

In May 1998, BNP Bail and Crédit Universel merged and created BNP Lease, with 90 branches. The Crédit Universel brand was retained for the full range of products offered to individual customers. The new group had a workforce of 1,350 employees and a total production of 20 billion francs, for outstanding loans totalling 54 billion francs. BNP Lease developed along three main lines: a policy of high value-added services, acquisitions and partnerships, and a European-scale sales offer. It represented a 6.5% share of the auto financing market.

Finally, following the creation of the BNP Paribas Group in 2000, BNP Lease and Compagnie Bancaire, France’s leading financial services group and part of Paribas, joined forces that same year to form BNP Paribas Lease Group, creating one major banking services group in Europe that operated under the BNP Paribas Leasing Solutions brand. The Crédit Universel brand was then discontinued in order to give more visibility to the new entity.

Conclusion

The history of Crédit Universel was perfectly in step with changes in the history of the French economy: the institution was able to build a range of products that would concretely meet the needs of postwar reconstruction, in conjunction with the era of mass consumption. Subsequently, through a dynamic and commercially aggressive strategy, the bank expanded its specialised financing, becoming one of the key players on the French financial scene. Working with BNP enabled it to contribute its expertise in specialised markets, while adapting to the pace of the banking group.

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