Crédit Agricole held back by its retail bank in the third quarter

Net banking income (NBI), equivalent to turnover in the sector, remained almost stable (-0,4%) between July and September, at 9,21 billion euros.

The bank's CEO, Philippe Brassac, hailed "very solid, very consistent performance" during a conference call.

Retail banking in France was caught in the third quarter by the rise in business failures, synonymous with unrepaid loans, on the one hand, and by an unfavourable comparison base effect over one year on the other.

The contribution of regional funds to the group's net profit fell by 36,9% over one year, to 371 million euros.

It "is mainly explained by the phenomenon of the rise in the cost of risk", that is to say the sums set aside to cover possible unpaid amounts on loans granted, stressed the deputy general manager of Crédit Agricole SA (Casa), Jérôme Grivet.

The risk is concentrated on a few files, professionals and SMEs in the tourism, hotel and catering, transport and real estate construction sectors, the bank specifies.

A reversal of provisions concerning housing savings plans (PEL), which had inflated the profit for the third quarter of 2023, accentuates the downward effect this year.

The regional banks of Crédit Agricole have accumulated 91 billion euros of PEL, a significant market share for this product.

Mr. Grivet also highlighted the dynamics of winning new customers - the stock increased by around 100.000 in the third quarter - and the restart of real estate credit after several quarters of scarcity.

Second step on the podium

The third quarter was more lenient for the group's listed entity, Crédit Agricole SA (Casa), whose net profit reached 1,67 billion euros, a decrease of 4,7% over one year.

The savings, insurance and large client businesses, including corporate and investment banking (CIB), remain the group's main driving forces.

Their net results are showing an increase, unlike LCL, the retail banking subsidiary of Casa in France, or specialized financial services, which were in poor shape between July and September.

The quarterly results are also weighed down by charges for Casa, up 9,2% over the year.

Casa "reported solid third-quarter results," RBC analysts said in a note.

Investors nevertheless received these figures coolly on Wednesday morning at the Paris Stock Exchange. Casa shares lost 4,75% at around 9:15 a.m., to 13,61 euros.

Overall, the mutualist group ranks second in terms of net profit among French banks in the third quarter, behind BNP Paribas (2,8 billion euros) and ahead of Société Générale (1,37 billion euros).

Mr. Brassac was also questioned about his succession at the head of Crédit Agricole, which must take place according to the group's statutes at the latest at the next general meeting of shareholders, scheduled for May 14, 2025.

"There is no doubt that in just a few months we will know the name of my successor," he replied, specifying that he will be able to "accompany him in taking up his duties with great serenity."

The banking group also announced on Wednesday the finalization of the acquisition of Nexity Property Management, a subsidiary of Nexity specializing in the management of tertiary, residential and commercial assets, announced on July 25.