CRARY Credit Agricole SA (PK)

(Updates with further detail, analyst comment and share movement)

 
   By Pietro Lombardi 
 

Shares in Credit Agricole SA (ACA.FR) rose in early trade Friday after its second-quarter net profit increased ahead of expectations, supported by strong performance in its corporate-and-investment business and growing revenues in most divisions.

Net profit for the period grew 6.4% to 1.44 billion euros ($1.68 billion), the bank said. France's second-largest listed bank by assets reported revenue of EUR5.17 billion, up from EUR4.71 billion a year earlier.

Analysts had expected the bank to report net profit of EUR980.7 million on revenue of EUR4.89 billion, according to a FactSet-provided consensus.

Excluding exceptional items, underlying net profit rose almost 20% on year to EUR1.42 billion, the bank said.

"In the second quarter of 2018, Credit Agricole SA generated its highest level of underlying net income group share since its IPO," Chief Executive Philippe Brassac said.

At 0703 GMT shares traded 2.3% higher.

The bank reported a "strong set of results showing the flexibility of the group, i.e. good revenue growth and cost flexibility to offset slowdown in some divisions," analysts at Jefferies said.

Credit Agricole's corporate-and-investment bank reported a 12% increase in revenue, to EUR1.53 billion, and a 34% increase in net profit to EUR578 million.

"This performance was driven primarily by the financing activity which benefited from strong activity levels on its markets, the positive effect of the rise in the oil price on the trade finance activity and several jumbo deals," Credit Agricole said.

Revenue and net profit fell on year at its retail lender LCL, the bank said. However, on an underlying basis revenue grew roughly 2%.

The results were also supported by a sharp decline in cost of risk, which fell roughly 36% on the year.

Credit Agricole's core Tier 1 ratio, a key measure of capital strength, was stable at 11.4% in June.

Write to Pietro Lombardi at pietro.lombardi@dowjones.com

(END) Dow Jones Newswires

August 03, 2018 03:37 ET (07:37 GMT)

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