Credit Agri­cole sells as­sets to strengthen cap­i­tal re­struc­tur­ing

The Pak Banker - - COMPANIES/BOSS -

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.

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