In its first official word on a potential corporate transaction, Emporiki described the talks as preliminary and as focusing on "consolidation" and "restructuring" in the Greek banking sector. A person familiar with the situation Tuesday confirmed that Crédit Agricole planned to sell the business.
Crédit Agricole paid €3.3 billion ($4.2 billion) for Emporiki six years ago and a sale would mark its retreat from Greece. The country's biggest lender, National Bank of Greece SA, earlier Monday told the Athens Stock Exchange it has held talks with Crédit Agricole "about the possibilities of future strategic alliances."
National Bank of Greece gave no other information about the nature of the talks. Similarly, Emporiki said only that "it has engaged in discussions with Greek banking organizations and the relevant regulatory authorities."
Crédit Agricole has been battered by exposure to about €24 billion of underperforming, failed and high-risk loans on the books of Emporiki. That vulnerability pushed Moody's Investors Service to downgrade the French lender's long-term debt to A2 from Aa3 in June, the second time in less than a year that Crédit Agricole has suffered a downgrade.
The Paris-based institution, which is led by CEO Jean-Paul Chifflet, said in May that first quarter profit had tumbled 75% to €252 million after it wrote off €940 million of net losses related to its Greek operation. Crédit Agricole is also reported to be in talks with brokerage firms to sell its unprofitable CA Chevreux business. The broker posted a €53.9 million loss last year.
Shares in Crédit Agricole traded Tuesday at €3.76, up €0.05, or 1.3%. The stock has climbed about 11% over the past two days as investors welcomed the prospect of a sale of Emporiki.
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