Credit Agricole in record £2.6bn loss
FRENCH bank Credit Agricole posted a record €3.07bn (£2.6bn) quarterly net loss yesterday, performing worse than expected due to the cost of shrinking its balance sheet and losses on Greek debt.
The semi-cooperative bank, which is under new management and trying to return to its low-risk retail lending roots, was hit by more than €2bn in quarterly one-off charges that it had already disclosed in December.
The bank’s revenue fell four per cent to €4.66bn, higher than average forecasts of €4.54bn.
Unprecedented cheap funding by the European Central Bank and a debt deal on Greece have calmed financial markets but the outlook is still uncertain, Credit Agricole’s chief said.
“We think 2012 is going to still be a tense period,” Jean-Paul Chifflet told journalists on a conference call. “We’re hoping that our results will be largely better than in 2011…the months of January and February, in everything that is [capital] markets, have been good.”
The investment bank, which is bearing the brunt of Credit Agricole’s asset sales to cut debt, saw fixed-income and equities revenue fall by around one-third and one-quarter respectively. Its financing business barely broke even.
Although Credit Agricole is less dependent on investment banking than other big European rivals, it has been burned by its purchase of local Greek bank Emporiki and the cost of shuttering risky activities after the 2008 financial crisis.
Chifflet said the bank would cut trader bonuses by 20 per cent.