PARIS (Reuters) - French bank Credit Agricole (CAGR.PA) said on Tuesday that its quarterly earnings rose 51 percent, helped by the sale of a Greek unit which had cost it heavily in the year-ago period.
Net profit rose to 469 million euros ($612 million) from a pro-forma 311 million. The year-ago results were weighed down by 907 million of losses related to Emporiki bank, as well as brokerage units Cheuvreux and CLSA.
Revenue slid 26 percent to 3.85 billion euros, depressed by accounting charges on the value of the bank’s own debt but also by weakness at its investment banking unit, hit by a retreat from some types of financing as well as a drop in bond issuance.
That was roughly in line with the average of analyst estimates of 3.89 billion euros, according to figures compiled by Thomson Reuters I/B/E/S.
Credit Agricole shares have gained 18 percent so far this year, helped by optimism that having shed Emporiki and reduced other foreign holdings, the bank can squeeze more profit out of its core retail banking market.
The lender controlled by a network of regional savings banks has said it plans to unveil a new industrial plan this autumn and has already embarked on an effort to cut 650 million euros in costs by 2016 through savings on back-office technology, equipment and real estate.
In one positive sign, doubtful loans fell 19 percent from the year-ago period to 765 million euros, reflecting lower provisioning for Italian consumer credit unit Agos Ducato, the bank said.
Credit Agricole’s Core Tier 1 ratio fell to 8.5 percent from 9.2 percent at the end of the year as a result of a transitional regulatory decision to count its insurance holdings as risk assets, a treatment that analysts say will be reversed later this year.
Rival Societe Generale (SOGN.PA), France’s No. 2 listed bank, reported separately on Tuesday that it is to cut 900 million euros in costs over the next three years after a weak domestic economy and one-off charges halved quarterly earnings. <ID:L6N0DN3BQ>
($1 = 0.7659 euros)
Reporting by Christian Plumb and Matthieu Protard; Editing by James Regan