Crédit Agricole Profit Boosted by Capital Gain

By Noemie Bisserbe

PARIS--Crédit Agricole SA on Wednesday reported a rise in second-quarter net profit, as the sale of its shares in Visa Europe countered the loss of the contribution from the group's regional banks to earnings.

The Paris-based lender, France's second-largest listed bank by assets, said net profit rose 26% to EUR1.16 billion ($1.30 billion) in the three months to the end of June from EUR920 million a year ago.

Revenue was up 2.4% at EUR4.74 billion.

Crédit Agricole booked a EUR328 million gain on the sale of its shares in Visa Europe in the second quarter.

Crédit Agricole is 56%-owned by the group's regional cooperative lenders and in turn controls 25% of those banks. The bank said in February it would sell back the 25% stake it holds in the group's regional lenders to ease concerns about its capital strength.

Crédit Agricole said on Wednesday it would book a gain of EUR1.25 billion on the sale in the third quarter of 2016.

Excluding one-off items, net profit rose 13% to EUR818 million, lifted by the group's insurance, asset management and specialized financial service units.

Crédit Agricole's insurance and asset management business reported an 8% increase in net profit to EUR415 million, while net profit for its specialized financial services business rose 23% to EUR154 million.

However, net profit at its corporate and investment bank fell 8% to EUR365 million, hit by volatile markets.

Crédit Agricole's own domestic retail arm, LCL, also reported a 38% drop in net profit to EUR108 million, hurt by persistently low interest rates.

Net profit for its international retail banking business, which includes Italy, Poland and Egypt, fell 16% to EUR77 million.

Crédit Agricole's core tier one ratio, which compares top-quality capital such as equity and retained earnings with risk-weighted assets, stood at 11.2% in June, up from 10.8% in March.

The bank's leverage ratio, which measures capital held by the bank against its total assets, was 4.5% in June compared with 4.4% at the end of March.

Write to Noemie Bisserbe at noemie.bisserbe@wsj.com

(END) Dow Jones Newswires

August 03, 2016 01:14 ET (05:14 GMT)

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