France's BPCE bank in 1.5 bn euro capital boost

22nd November 2011, Comments 0 comments

France's BPCE banking group has decided to boost the capital of its mortgage unit Credit Foncier by 1.5 billion euros ($2 billion) due to its exposure to Greek sovereign debt, a spokeswoman said Tuesday.

The amount includes a 500 million euro advance announced when France's third largest bank by assets presented quarterly results at the beginning of the month.

BPCE posted a 60 percent drop in its July-September earnings compared to the same period last year to 332 million euros due to a significant drop in the value of its holdings of Greek government bonds.

Credit Foncier sought to diversify its business in 2006-2008 by buying debt of foreign countries and companies, and also holds a considerable amount of Italian government bonds.

BPCE includes the Caisse d'Epargne and Banque Populaire retail banks.

© 2011 AFP

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