July 30, 2018 / 5:53 AM / 4 months ago

French insurer CNP shies away from merger talk as first half profits rise

PARIS (Reuters) - French insurer CNP, which has been the subject of merger speculation, reiterated its annual earnings growth targets as it posted higher interim net profits.

CNP’s first-half net profits rose 2.3 percent to 672 million euros ($783.55 million). Excluding the effects of currency swings and exceptional elements, net profit rose 2.6 percent.

First-half earnings before interest and taxes (EBIT) rose 1.5 percent from a year ago to 1.5 billion euros, or 7.9 percent when excluding currency swings and exceptional elements. EBIT had advanced by 1.8 percent in the first quarter.

CNP also reiterated it expected EBIT to grow by more than 5 percent on an organic basis, excluding the impact of factors such as currency swings, this year after 7.9 percent growth in the first half.

Asked about a possible merger with Banque Postale, the banking unit of France’s La Poste postal service, Antoine Lissowski, who will take over as interim chief executive on Sept. 1, declined to comment.

“It’s not up to us to discuss it,” Lissowski said.

French state-owned financial firm Caisse des Depots et Consignations (CDC) is considering selling its 41 percent stake in CNP to La Poste, a source close to La Poste said earlier this month.

La Poste would then merge its bank, La Banque Postale, with CNP Assurances to expand the range of services it provides.

Lissowski also referred back to a comment made last week by CDC’s chief executive Eric Lombard, when Lombard said CDC wanted to keep CNP Assurances as a listed company.

The French government, which owns both CDC and La Poste, wants to build up a state-owned company that would provide both banking and insurance services in the country’s rural areas which are often neglected by private companies.

CNP shares were up 0.5 percent in early session trading.

Lissowski was named as CNP’s interim chief executive after Frederic Lavenir unexpectedly quit from the post earlier this month.

Reporting by Inti Landauro and Matthieu Protard; Editing by Sudip Kar-Gupta

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