Credit Agricole sells assets to strengthen capital restructuring
PARIS: French banking group Credit Agricole on Wednesday said it would sell stakes in 39 of its regional operations for 18 billion euros as part of a push to strengthen its capital base.
The $20 billion sale by listed entity Credit Agricole SA to regional network specialist SACAM Mutualisation is expected in the third quarter of 2016, the group said in a statement.
The sale will "do away with a rather unbearable paradox" which consists of "being a highly-capitalised large banking group" but whose listed entity is often the aim "of some kind of doubt" concerning the solidity of its capital base, Philippe Brassac said at a news conference.
Credit Agricole shares, which had shed around a fifth of their value since January, surged in reaction to the announcement, rising by 8 percent in early Paris stock exchange trading.
Credit Agricole on Wednesday also reported strong net 2015 profits, up 22 percent to 6.0 billion euros ($6.5 billion), for the network including regional branches.
The stake sale would simplify the group's structure to make it "more comprehensible and transparent", chairman Dominique Lefebvre added.