Calculation of APR

Definition of the target method for calculating APR in the context of renegotiations of mortgage loans


Regulatory changes to European directives and their national transposition have provided further details regarding the methods used to calculate APR/AAR information in mortgage loan offers. The authorities have been paying particular attention to this contractual information for a number of years. An increase in customer disputes has been observed due to companies’ sometimes non-compliant practices. These disputes generate legal risk with significant financial consequences. Banks have made significant provisions to cover this risk.


In response, banks are seeking to specify the standard for calculating APR and AAR in accordance with the regulations in force, as well as the standard for presenting information to customers, and to assess the consequences of changes to these new calculation rules (costs, risks, IS impacts, etc.).


Through their analyses, the Ares & Co teams were able to overhaul the method used to calculate APR/AAR through:

  • Definition of the procedures for calculating APR/AAR following analysis of the regulations
  • Production of a macro-plan for implementing the target method and evaluation of the associated costs and lead times based on analysis of the consequences of a modification of the calculation formula on the information systems and the publication of documents (calculation algorithms, depreciation tables, etc.)
  • Production of a file presenting the opportunities involved in making changes to the calculation method and the risks involved in non-compliance

Fintechs Solution

Conducting a study of investment opportunities in Fintechs in Eastern Europe for a European Development Bank


In recent years, the proliferation of Fintechs has shaken up the financial services sector (online banking, crowdfunding, mobile payment, savings management, financial and decision-making consulting). The Fintech wave, which is based on the convergence of several types of disruptive innovations (data transmission, storage and use and artificial intelligence), is impacting traditional finance professions to the point of potentially revolutionising the production and marketing models within the sector.


As part of its role to provide development assistance (economic and social dynamism, access to credit and financial inclusion), the Bank sought play an active role in the development of Fintechs in Central and Eastern Europe (CEE). In anticipation of targeted investments, it wanted a comprehensive overview of the existing Fintech situation in six countries in the region and the associated investment opportunities, in particular in terms of Alternative Business Lending and payments.


Four key success factors predominate in the development of Fintechs in CEE: dynamic underlying demand, favourable access to venture capital, strong human capital and tech-friendly local regulations.

The analyses carried out by the Ares & Co teams revealed:

  • Significant macroeconomic heterogeneity among the six countries analysed (economic dynamism, underlying markets and maturity in infrastructure vs digital)
  • An emerging Venture Capital/Private Equity ecosystem (mismatch between supply and demand for venture capital, low valuations and investor appetite and a lack of understanding of the specific features of early-stage tech ventures)
  • Solid human capital (entrepreneurial culture and digital skills)
  • Overall favourable regulations, reflected in local and regional initiatives (e-residency programme, sandboxes and innovation hubs)

Based on this observation, itself based on a detailed analysis of more than 300 Fintechs, the Ares & Co teams identified three channels to support the development of Fintechs in Eastern Europe:

  • Equity investment: two targets identified, in line with the Bank’s investment guidelines
  • Debt investment: three lending platforms selected, with provision of direct and indirect financing lines (via local banks)
  • Proactive advisory and lobbying activities

Ares & Co also readjusted the Bank’s investment framework, in particular by reviewing the investment cycle, decision-making processes, all management indicators and valuation methods.

Distribution strategy

Help to define the target vision of the distribution strategy for a large European Insurance Company


Distribution strategy is a powerful lever when it comes to the transformation of Insurance Companies. Companies have already launched a number of initiatives (strengthening of the digital strategy, launch of new points of sale formats, equipping of sales forces with modern tools, launch of bouquets of non-insurance services to meet customer needs, etc.) that have produced significant results.


In this context, breathe new life into the transformation plan by designing a target vision of the distribution strategy and a unifying document clearly setting out the vision, objectives, key themes and principal initiatives.


The development of the new sales strategy for 2025 was designed with a twofold objective: on the one hand, to encourage customer conquest and loyalty in an increasingly competitive market and, on the other, to optimise the commercial efficiency of the distribution networks.

The Ares & Co teams challenged the existing distribution model and proposed a new, more efficient model based on value-sharing principles between the company and the distributor. The main features of a new, innovative form of distribution were developed, including:

  • The detailed value proposition of the new distributor
  • The remuneration policy, in line with the objectives of the new commercial strategy and incorporating the notion of customer value
  • The point-of-sale concept for the future
  • The business model for each new distributor profile
  • The main operating principles of the sales tool integrating new technologies (Artificial Intelligence and Analytics)

Client Value

Deepen customer knowledge and consolidate decision-making support systems for the sales teams of a retail bank


Despite generally favourable results, pressure on the business model of retail banks in France is increasing under the combined effects of a weaker macroeconomic context (low interest rates, lower margins and pressure on fees) and strong regulatory constraints (explicit priority given to the SSM when analysing banks’ profitability). This trend is further accentuated by changes in customer behaviour and expectations (service differentiation and pricing levels) and strong competitive pressures within the sector.


In response, banks are seeking to fine-tune their management model and interpret their economic performance in more detail to facilitate decision-making. This process of improving the commercial and financial management of customer relations required a better understanding of their value (relevance in segmentation, targeting of offers, detailed analyses, value-added strategic and operational marketing actions, etc.) and implementation of the right tools to measure them.


Ares & Co worked with the marketing department to define customer value by prototyping and modelling new target indicators based on a broad data scope (assessment of potential at X years, interpretation of potential attrition, product life expectancy, loyalty potential, etc.). The firm also facilitated the involvement of internal teams and coordinated the integration of customer value measurement into the institution’s entire transformation project through the lens of customer relations (relevance in customer segmentation, targeting of offers and implementation of value-added strategic and operational marketing actions).