Business
Credit Agricole profit beats forecasts on Italy stake gain
Credit Agricole profit beats forecasts on Italy stake gain
About this update from Banco Bpm Spa
By Mathieu Rosemain France's Credit Agricole SA EURONEXT:ACA said on Thursday its third-quarter profit rose 10%, beating expectations but helped by a revaluation gain on its increased stake in Italy's Banco BPM MIL:BAMI and stronger investment banking revenues.Net income came in at 1.84 billion euros ($2.15 billion) in the three months to end-September, up 10.2% from a year earlier and above a company-compiled analyst consensus of 1.76 billion euros.Without the BPM-related gain, the bank's quarterly net income would have fallen slightly versus last year, Chief Financial Officer Clotilde L'Angevin told reporters. Credit Agricole said its numbers also benefited from taking full ownership of asset services company CACEIS by buying out Santander in July.Total revenues rose 5.6% to 6.85 billion euros, while loan-loss provisions increased 13% to 489 million euros.A KEY PLAYER IN ITALY'S M&A WAVECredit Agricole's performance was boosted by a 245 million-euro revaluation of its near-20% stake in BPM. The French lender has taken an increasingly prominent role in the consolidation wave sweeping Italian banking by hiking its stake in BPM and seeking regulatory approval to lift it to 29.9%.Credit Agricole representatives have held talks with the Italian government about a possible tie-up, Reuters reported last month. "We are attentive to everything that may happen," CEO Olivier Gavalda told reporters on Thursday, without commenting further.Banco BPM CEO Giuseppe Castagna said last month that a merger with Credit Agricole’s Italian operations represented the "clearest opportunity" for his bank, though he noted other options, including Monte dei Paschi.Italy, Credit Agricole's largest market outside France accounting for 15% of reported profit in 2024, has been central to the bank's growth strategy.INVESTMENT BANK GROWSThe bank's corporate and investment banking division delivered record revenue, up 3.3% to 1.58 billion euros.Trading in fixed income, currencies and commodities rose 6.3%, beating bigger French rival BNP Paribas but below Societe Generale and some Wall Street peers. Credit Agricole's domestic retail unit, LCL, posted revenue of 982 million euros, stable from a year earlier. Net interest income in France, or the difference between what banks earn on loans and pay out for deposits, was steady too. The bank's CET1 capital ratio, a key measure of financial s...