Credit Agricole pledged to increase cost savings and synergies by 2019 in an effort to offset lower earnings resulting from an €18 billion internal reorganisation.
The new plan presented today marks a new chapter in the strategy of the French bank with a refocusing on the core markets of France and Italy, after a failed foreign expansion campaign and with the overcoming of the internal divisions of the group.
The bank, not excluding acquisitions by its asset management company AmundiHowever, it said it could further streamline its presence in non-core countries such as Egypt, Saudi Arabia, Morocco and Ukraine if opportunities present themselves.
With the new plan, Credit Agricole aims for annual savings of 900 million euros by 2019 through a simplification of its structure that brings together different legal entities and reducing IT costs. No comments on possible layoffs.
In particular, the group aims for profits of 7,2 billion in 2019 and the subsidiary Casa at 4,2 billion from respectively 6,04 and 3,52 billion in 2015. The group also expects revenue growth of 1,5% by 2019 and 2,5% for Casa. Credit Agricole aims to bring its CET 1 from 13,7% in 2015 to 16% in 2019, the payout to 50% in cash and to make investments of 7,7 billion euros over the course of the plan.
The objective in Italy, where Credit Agricole is present with 15 companies active in the banking, financial and insurance segments, is to achieve 800 million in synergies from revenues, up 40% compared to 2015. As regards the group cariparma Crédit Agricole, the plan provides for 625 million investments and the achievement of 2 million customers. The Credit Agricole share remained strong in Paris where, just before 15 pm Italian time, it jumped by more than 3% against a 1% rise in the main index.
