€ 4.3 billion issued

In 2000, CADES issued an impressive € 2.1 billion in international medium-term debt (EMTN). In 2001, CADES was particularly active in the bond markets, completing 12 transactions.

Worth noting: two MTS benchmark issues (3.375% July 2004 and 5.25% October 2012) and indexed bonds were tapped up ten times.

CADES: an active issuer

Since it was founded, CADES has been an active debt issuer. After an initial period during which most of its issues were short-term instruments, CADES shifted its focus, smoothing out its debt profile with longer maturities that combine liquidity and creativity. In six years, CADES has issued 40 tranches of bonds in six different currencies, including two indexed issues; 2,420 short-term papers (domestic, US and euro commercial paper); two syndicated loans; 36 MTNs; and nine private placements.

Debt structure by currency
in euros

CADES: an international issuer

At December 31, more than 35% of the CADES debt was in the hands of non-resident investors. This diversity reflects its reputation as an issuer of quality, its 0% Basel ratio weighting, and the intensive communications campaigns initiated abroad. In less than six years, CADES has made more than 25 overseas presentations.

CADES, a benchmark issuer of bonds pegged to the French consumer price index

Indexed issues were prevalent for CADES in 2001, accounting for 57% of total issues.Ten tranches were issued in 2001 for a total of € 2.48 billion on two outstanding notes, the Cades i 3.8% July 2006 and the Cades i 3.15% July 2013.This strategy, which is based on the strong correlation between French inflation and the CRDS, CADES' primary resource, has given CADES a pivotal position in this market, which is attracting increasing attention on the part of investors.

CADES on MTS France

In the interest of enhancing the liquidity of its
benchmark issues in euros, CADES decided to list
three of them as of April 2001 on MTS France, which
were tapped up to more than € 3 billion in 2001.
This listing on MTS France, as well as the
implementation of a pool of 16 primary dealers
committed to making market, had an immediate
impact: in November 2001, the aggregate liquidity
of the three issues was € 2 billion.

A secure structure

The Cades risk management strategy is supported
by three pillars: an effective asset liability management model; the elimination of exchange rate volatility; and substantial reduction of the counterparty risk through weekly, and sometimes daily, automatic margin calls. CADES has also implemented an effective governance structure, subjecting its financial statements not only to an audit by its Board of Directors and Supervisory Board, whose members include legislators, but also to the specific mechanism that governs all public agencies in France.CADES has also opted for a parallel, private certified audit procedure, commonly used by credit institutions, in compliance with recommendations issued by the Basel Committee and the CRBF (Comité de la réglementation Bancaire et Financière), which regulates the French banking and financial services industry.

Based on a CRDS revenue target of € 4.6 billion, scheduled redemptions of € 4.5 billion and a payment to the government of € 3 billion, CADES plans to issue nearly € 4.5 billion in 2002.This year 's issuance policy will be guided by three major considerations:

• Maintain sufficient liquidity for the three listings on the MTS France,
• Remain actively focused on bonds pegged to the French consumer price index (excluding tobacco). The addition of a third point to the yield curve is also being considered,
• Develop customized products, including structured products, private placements or new currency denominations.

The January 2002 issue of a € 380 million "Uridashi" (3.7% , due February 2005)bond targeting Japanese retail investors meets funding objectives.