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In the complex architecture of French cooperative banking networksCentral bodies occupy a pivotal position. They ensure the cohesion and strategic steering of banking groups whose decentralised structure might seem incompatible with the Group's core values. modern prudential requirements.
The legal uniqueness of these bodies lies in their dual nature as private entities with quasi-regal prerogatives. This duality is worth examining, as it raises questions about the relationship between local cooperative autonomy and centralised decision-making.
Legal missions set out in the Monetary and Financial Code
Articles L.511-30 to L.511-32 of the Monetary and Financial Code provide a precise framework for the role of central bodies. These provisions give them three essential roles.
Strategic coordination and leadership
The central bodies determine the general direction of the network. Article L.511-31 of the Monetary and Financial Code gives them the task of "ensuring the cohesion of their network and the smooth operation of the institutions and companies affiliated to them".
In practical terms, a central body such as BPCE defines common commercial policies and coordinates the actions of the various entities in the group. This coordination is all the more crucial given that the French cooperative networks often comprise dozens of legally distinct establishments.
The Conseil d'État recognised this guiding function in its decision of 9 March 2018 concerning Crédit Mutuel, stressing that the central body is responsible for exercising "administrative, technical and financial control over the organisation and management of each caisse."
Guarantor of financial solidity
The central bodies are legally obliged to guarantee the liquidity and solvency of the entire network.
This mission translates into a number of significant prerogatives:
- The ability to take all necessary measures to guarantee the Group's liquidity
- The power to create a joint guarantee fund
- The ability to limit or prohibit the distribution of dividends
Article L.512-107 of the French Monetary and Financial Code states that the central body of the Caisses d'épargne and the banques populaires is responsible for "taking all necessary measures to guarantee the solvency of the group".
A concrete illustration of this power is provided by article R.512-14 of the French Monetary and Financial Code, which authorises Crédit Agricole's central body to demand the immediate repayment of advances in the event of a breach of the Articles of Association or malfeasance.
The exercise of quasi-regal prerogatives
The central bodies exercise prerogatives that go beyond ordinary law. They approve the appointment of managers of affiliated institutions and may dismiss them.
For example, article L.512-40 of the French Monetary and Financial Code states that "the directors of the regional mutual agricultural credit banks may be dismissed by decision of the managing director of the central body of agricultural credit".
The Conseil d'État described these prerogatives in its ruling of 9 March 2018 (no. 399413) in the following terms: "the legislator has entrusted this confederation, even though it is an association under private law governed by the law of 1 July 1901, with the performance, under the control of the administration, of a public service involving the use of prerogatives of public authority."
These powers are accompanied by the ability to impose sanctions. Confédération Nationale du Crédit Mutuel can issue a warning, reprimand or strike off an affiliated institution (article R.512-24 of the French Monetary and Financial Code).
Affiliation and disaffiliation: a regulated process
The affiliation of an institution to a central body follows a strict procedure. Article R.512-57 of the Monetary and Financial Code stipulates that the decision to affiliate taken by the central body must be notified twice: to the institution concerned and to the Autorité de contrôle prudentiel et de résolution (ACPR).
The disaffiliation process raises complex legal issues. The Court of Justice of the European Union ruled on the matter in its judgment of 2 October 2019 (Crédit Mutuel Arkéa v ECB, Case C-152/18), stating that "Article 127(6) TFEU and Article 1 of Regulation No 1024/2013 do not preclude the ECB from exercising prudential supervision on a consolidated basis over a banking group whose central body does not have the status of a credit institution."
This dispute illustrates the tensions that can exist between the aspirations of certain entities for autonomy and the cohesion of the network guaranteed by the central body.
The specific characteristics of France's three main central bodies
To better understand the role of these entities, it is essential to examine the context of the major French cooperative banking networks.
BPCE: the merger of two banking cultures
BPCE, created by law no. 2009-715 of 18 June 2009, is the result of the merger of the Banques Populaires and Caisses d'Épargne networks. Article L.512-106 of the French Monetary and Financial Code specifies that it "is constituted in the form of a limited company in which the Banques Populaires and the Caisses d'Epargne et de Prévoyance together hold an absolute majority of the share capital and voting rights".
The governance of BPCE reflects this original duality: the representatives of the members proposed by the Chairmen of the Steering and Supervisory Boards of the Caisses d'Epargne and the Chairmen of the Boards of Directors of the Banques Populaires have a majority on its Supervisory Board.
Crédit Agricole SA: between central body and listed group
Crédit Agricole SA is unique in that it is both the central body of the Crédit Agricole network and a listed company. Article L.512-47 of the French Monetary and Financial Code defines it as "a public limited company, responsible for facilitating, coordinating and controlling the execution of the transactions" of the network.
Its capital structure, defined in article L.512-48, includes a specific distribution of voting rights: "one third in equal shares between the Regional Agricultural Credit Banks and the remaining two thirds in proportion to the number of shares held by each of them".
Confédération Nationale du Crédit Mutuel: an atypical associative status
Unlike the previous two, Confédération Nationale du Crédit Mutuel is set up as an association under the 1901 Act. Its articles of association are approved by the Minister for the Economy (last approved on 10 July 2018).
This legal form does not prevent it from exercising important prerogatives. Article L.512-56 of the French Monetary and Financial Code gives it the task of "exercising administrative, technical and financial control over the organisation and management of each caisse de crédit mutuel".
It also has significant powers to impose sanctions. It can impose sanctions up to and including removal from the list of affiliated institutions, resulting in loss of authorisation (article R.512-24 of the Monetary and Financial Code).
A dispute may be brought before the confederation's general meeting, then before the competent court (article R.512-25), which constitutes a specific form of appeal.
Faced with this complex architecture, our teams specialising in banking law regularly assists affiliated institutions in their relations with their central body, particularly during procedures for approving managers or amending the Articles of Association. If you would like a personal consultation on any of these issues, please contact us.
Sources
- Monetary and Financial Code, articles L.511-30 to L.511-32, L.512-47, L.512-48, L.512-56, L.512-106, L.512-107, R.512-14, R.512-24, R.512-25, R.512-57
- Conseil d'État, 9 March 2018, req. no. 399413
- Court of Justice of the European Union, 2 October 2019, Crédit Mutuel Arkéa v ECB, Case C-152/18
- Act no. 2009-715 of 18 June 2009 on the central body for savings banks and banques populaires (French version)
- Thibault de RAVEL D'ESCLAPON, "Coopérative de crédit", Répertoire des sociétés, October 2023
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