A new debt transfer , a new resource, a new funding programme for 2009.

PRESS RELEASE

January 13, 2009- In 13 years, CADES has amortised €37.5 bn of social debt and today is confidently pursuing its objective of amortising all its social security debt assumed to date

Mr. Patrice Ract Madoux , Chairman of CADES Board of Directors, presented in Paris and London a review of CADES issuing programme in 2008 and its funding programme for 2009, to an audience of financial journalists.

€8.6 bn programme in 2008

A first rank issuer since its inception, and despite increasingly difficult market conditions, CADES (Caisse d’Amortissement de la Dette Sociale ) was able to provide the market with major debt issues and further diversify its investor base.

In 2008, CADES made use of a broad spectrum of financial instruments: €3 bn in benchmark bonds denominated in euros, €3.5 bn in benchmark bonds denominated in American and Australian dollars, €0.566bn in private placements and MTNs, and short term financing.

€27 bn newly assumed debt

2009 Social Security Finance Act n° 2008-1330 extended CADES mission.

€26.9 bn additional debt was transferred to CADES from the Health branch (€14.1 bn), €8.8 bn from the Elderly branch, and €4 bn from the Old Age Solidarity Fund. Broken down into three tranches, the transfer will include three successive payments of €10 bn (already paid), €10 bn before February 6 th and €6.9 bn before March 6 th 2009 .

In accordance with organic law of August 2 nd 2005 , an increase of resource was voted by the Parliament to ensure CADES life span is not extended. This new resource, 0.2 of a percentage point of CSG (Contribution Sociale Généralisée) is a stable and steady resource which increased under the same conditions as the CRDS (Contribution pour le Remboursement de la Dette Sociale), which was the main resource of CADES since 1996. As a result, resources of CADES will reach €8.3 bn in 2009.

2009 funding strategy : a €33.1 bn programme

In 2009, with newly assumed debt, CADES will intensify its flexible and diversified bond issuing programme.

CADES should give preference to benchmark bonds denominated in euros (€10 to €17 bn), bonds linked to French inflation rate (€0.5 to €1.5 bn), benchmark bonds denominated in other currencies than euro (€3.3 to 6.3 bn), private placements and MTNs (€1 to €2 bn) plus short term financing (€6.3 to €18.3 bn)

This funding programme should reach approximately €33.1 bn in 2009 which would rank CADES among the top sovereign and quasi sovereign issuers in Europe .

A strong capacity to adapt and to react quickly

Regularly in contact with investors, CADES has always adapted its funding requirements in accordance with its own needs and the perceived requirements of its markets. CADES is characterised by a highly flexible approach in its funding programmes by offering to the market a range of financial instruments and maturities (bonds in euros, in US dollars, in other currencies, inflation-linked instruments, private placements and MTNs).

The scope of its offer has provided CADES with a growing investor base able to benefit from the best financial tools to meet the market’s expectations. Moreover, in the current context of substantial volatility in the world’s capital markets, the range of financial assets which it provides plus the transparency that CADES has always striven for provide greater comfort and stability for investors.

CADES: A BENCHMARK ISSUER IN THE FINANCIAL MARKETS

Created in 1996, CADES is the administrative public agency, placed directly under the French authority of the French State, in charge of managing and amortizing the French social debt.

It has been awarded the highest ratings by the principal international rating agencies (AAA/A1+, Aaa/P1, AAA/F1+), and a 0% Basel ratio weighting

CADES
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