Coface strategic plan “Power to the Core”: Using data science and AI to achieve greater customer benefit

Vienna (OTS) – Paris / Vienna, March 22, 2024 – With the new strategic plan “Power the Core”, the international credit insurer Coface is pursuing the goal of creating a leading global ecosystem in credit risk management by 2027. “Our goal is to further maximize added value for customers and partners by investing in data and technologies“, emphasizes Dagmar Koch, Country Manager of Coface Austria. “Our new strategic plan ‘Power the Core’ draws on our strengths and the commitment and expertise of all employees to accelerate our transformation“, explains Coface Group CEO Xavier Durand. The focus is on the core business, trade credit insurance, as well as on services in the area of ​​business information.

Coface plans targeted investments in data and technology to build new, differentiating data and scoring capabilities that incorporate cutting-edge modeling techniques such as data science and artificial intelligence. “Our customers are confronted with increasing complexity and new challenges. Environmental social governance, supply chain monitoring, cyber security and liquidity protection; just to mention a few keywords. There is often significant personnel expenditure behind this. We are therefore concentrating our investments on technology and connectivity in order to further relieve our customers and reduce the effort for credit risk management“, emphasizes Koch and continues: “We will deepen and expand the trade credit insurance business. In addition to disciplined underwriting, Coface will continue to invest in growth in the SME segment and medium-sized companies in order to simplify processes and further optimize the customer experience, particularly for this customer segment.“In addition, we will continue the profitable double-digit growth in the business information area. Investments are being made here in the continuous expansion of the sales teams, the expansion of the channels for data acquisition and diversification of the fields of application as well as the ongoing development of the IT infrastructure.

Expansion of corporate culture and CSR

„Our corporate culture and our values ​​are the basis of our success and have long played a special role at Coface. We want to further expand our uniqueness and thereby create an attractive employer offer. This goes hand in hand with ongoing CSR measures. The purpose and team spirit of our organization are particularly important to employees and to me too. We feel this purpose every day at work and that is what drives us – a trusting and cooperative collaboration with our customers and partners ‘trade with confidence’“, emphasizes Koch.
At the same time, the company is pursuing ambitious financial targets for 2027 and beyond.

These include:

• an undiscounted combined ratio of approximately 78 percent over the entire cycle, an improvement of 2 percentage points over the previous plan
• an average return on equity of 11 percent over the entire cycle. This goal applies to the current interest rate environment.
• A solvency ratio at the upper end of the target range of 155 to 175 percent with a payout ratio of at least 80 percent of net profits.
• An additional contribution from the Business Information division to the Group’s return on equity of 50 basis points from 2027.

Positive balance: “Build to Lead”: a complete success

With the successful strategic plans “Build to Lead” (2020 to 2023) and “Fit to Win” (2016 to 2019), Coface has laid a strong foundation for future development. “Build to Lead” was presented in February 2020, shortly before the outbreak of the corona pandemic. Despite the volatile economic environment in the following years, Coface stuck to its strategic direction. The risk experts were able to rely on their agility and meet or exceed all strategy goals. The combined combined ratio was significantly reduced between 2020 and 2023 and, at an average of 69.1 percent, was well below the target. The average return on equity in the same period was 10.8 percent, which is above the target value. Coface also recorded positive developments in the business information sector: growth in this pure service activity, which does not require regulatory capital, reached an average of 13 percent between 2019 and 2023.

„The great successes of our strategic plans ‘Fit to Win’ and ‘Build to Lead’ have created a solid foundation for Coface. We have proven that our business areas complement each other. This will enable the next step to develop a leading credit risk management ecosystem that offers our customers even greater added value“, emphasizes Durand and concludes: “We will make targeted investments in data and technology for trade credit insurance and our business information. We will continue to expand our leading role in credit insurance and at the same time aim for double-digit profitable growth in information services. To achieve these ambitious goals, we leverage our unique culture as a multinational corporation committed to our customers and committed to our responsibility in sustainability. We are once again raising our full-cycle financial targets and are targeting an additional 50 basis points contribution from Business Information to the Group’s return on equity from 2027. Just like the previous strategic plan, the commitment of our employees and partners will be a key pillar of our shared success in serving our customers.“

COFACE: FOR TRADE

With 75 years of experience and the densest international network, Coface is a major credit insurer, partner in corporate risk management and in the global economy. With the aim of becoming the most agile credit insurer in the world, Coface supports 50,000 customers in building and dynamically developing businesses. The products and services protect companies in national and international business and help them make credit decisions. In 2022, Coface was active in 100 countries with around 4,720 employees and achieved sales of approximately 1.81 billion euros.

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Carina KISS: +43/1/515 54-510 – carina.kiss@coface.com