Capital Markets

Mnuchin expected to be Trump’s Treasury secretary

Donald Trump has chosen Steven Mnuchin as his Treasury secretary, US media outlets reported on Tuesday, positioning the former Goldman Sachs banker to be the latest Wall Street veteran to receive a top administration post. Mr Mnuchin chairs both Dune Capital Management and Dune Entertainment Partners and has been a longtime business associate of Mr […]

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Banks

Financial system more vulnerable after Trump victory, says BoE

The US election outcome has “reinforced existing vulnerabilities” in the financial system, the Bank of England has warned, adding that the outlook for financial stability in the UK remains challenging. The BoE said on Wednesday that vulnerabilities that were already considered “elevated” have worsened since its last report on financial stability in July, in the […]

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Property

Zoopla wins back customers from online property rival

Zoopla chief executive Alex Chesterman has branded rival OnTheMarket “a failed experiment”, and said that his property site was winning back customers at a record rate. OnTheMarket was set up last year, aiming to compete with Zoopla and Rightmove, the UK’s two biggest property portals. It allowed estate agents to list their properties more cheaply […]

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Financial

Hard-hit online lender CAN Capital makes executive changes

The biggest online lender to small businesses in the US has pulled down the shutters and put its top managers on a leave of absence, in the latest blow to an industry grappling with mounting fears over credit quality. Atlanta-based CAN Capital said on Tuesday that it had replaced a trio of senior executives, after […]

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Banks

BoE stress tests: all you need to know

The Bank of England has released the results of its latest round of its annual banking stress tests and its semi-annual financial stability report this morning. Used to measure the resilience of a bank’s balance sheet in adverse scenarios, the stress tests measured the impact of a severe slowdown in Chinese growth, a global recession […]

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Categorized | Banks, Equities

Crédit Agricole poised for profit warning


Posted on January 31, 2013

Crédit Agricole is poised to issue a profits warning, which could come as soon as Friday, linked to reducing the amount of goodwill on its books.

Shares in the French bank fell 1.5 per cent to close at €7.28 on Thursday on fears that the publicly quoted but mutually owned bank would warn investors that it would not meet consensus estimates for the fourth quarter, because of bigger than expected write-offs.

    In November, Crédit Agricole reported a worse than expected third-quarter loss of €2.85bn, reflecting the weighty price paid for its exit from Greece and exposure to other heavily indebted eurozone countries, including Italy and Spain.

    The bank is already in the red for the nine months to the end of September 2012, having made a net loss of €2.5bn during the period, mainly due to Emporiki, its lossmaking Greek bank, which it sold in October for €1 to Alpha Bank of Greece, incurring a €1.8bn loss.

    “The main focus is likely to be on goodwill, which stood at €17bn in June 2012,” said analysts at Citigroup. The analysts added that the temptation to “kitchen-sink” the accounts – that is include as many writedowns as possible – in the fourth quarter would be great given the extent of restructuring this year to help conform to new regulatory rules.

    Société Générale, France’ second-biggest bank by market value, said earlier this month it planned a €384m writedown on the goodwill of its 50 per cent stake in Newedge, the broker. Crédit Agricole owns the remaining share of Newedge.

    Analysts expect Crédit Agricole, which is France’s third-largest bank by market value, to announce a list of one-off writedowns and impairments when it reports its full-year results on February 20.

    These are expected to include a €750m loss on the theoretical cost of buying back its own debt and provisions at Cariparma and Agos, its Italian subsidiaries.

    The bank recorded a €572m goodwill impairment, mostly on its Italian consumer-credit business, in its third quarter.