French lender Credit Agricole Group has posted a net profit of EUR1.56bn in the fourth quarter of 2015, up 16% compared to the prior-year quarter.
The bank’s pre-tax income stood at EUR2.27bn, a 15.8% rise from the corresponding quarter of 2014. Revenues increased 9.6% year-on-year to EUR8.03bn.
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Regional Banks, part of the bank’s French retail banking division, had a contribution of EUR229m in net income group share. This represented a 10.5% rise from the year-ago quarter.
LCL, another constituent of the French retail banking division, reported revenues of EUR874m, a 2.7% increase compared to a year ago.
Revenue at the bank’s international retail banking division increased 1.1% year-on-year to EUR649m.
In addition, the bank has also announced plans to sell back the 25% stake it holds in the group’s regional banks for EUR18bn ($20bn) in a bid to simplify its capital structure.
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By GlobalDataThe deal would include Crédit Agricole S.A’s intragroup transfer of the co-operative investment certificates and cooperative associate certificates held in the regional banks. The stakes would be transferred to a group that is wholly owned by the regional banks.
The listed entity would repay EUR5bn to the regional banks to unwind an intragroup guarantee mechanism, as well as would lend them EUR11bn over a 10-year term to finance the deal.
The bank in a statement said: "The proposed transaction would be overall neutral at Group level, whether in terms of regulatory ratios, liquidity, earnings or tax. For Crédit Agricole S.A., the immediate positive benefit would be a 41 bps increase in its fully loaded CET1 ratio to over 11% pro forma as soon as of January 1st 2016."
