Credit Agricole struggles to turn page with huge writedown
Baku, November 12 (AZERTAC). Falling profits in retail and investment banking left investors worried whether Credit Agricole (CAGR.PA) is on the mend after the French bank took $4.6 billion of writedowns to try to draw a line under ill-fated deals.
Shares in France1s No.3 bank were down over 8 percent in Friday afternoon trading after it missed third-quarter profit forecasts, even after stripping out the 3.6 billion euros of writedowns, including on investments in Greece, Italy and Spain.
"You have to concentrate on what you are good at," said Yannick Naud, a portfolio manager at Glendevon King Asset Management in London. "That`s the main problem with Credit Agricole. Except for retail banking in France, there are very few activities in which they are market leaders."
Banks across Europe are slashing costs and shedding assets to cope with tougher regulations aimed at preventing a repeat of the 2008 financial crisis. The task has been complicated by a weakening economy as governments drive through austerity measures to clean up their own finances.
Credit Agricole announced a 1.96 billion euro writedown on the sale of Greek unit Emporiki, in line with expectations but taking the total cost of its disastrous foray into the debt-stricken country to around 7.5 billion euros.
Including writedowns on its soon-to-be sold Cheuvreux brokerage, its Italian consumer credit business, Spain1s Bankinter (BKT.MC), and losses on its own debt, the bank slumped to a quarterly loss of 2.85 billion euros.
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