French bank Credit Agricole to cut 2,350 jobs
French banking group Credit Agricole announced Wednesday it is cutting 2,350 jobs around the world but would still post a profit this year although not pay shareholders a dividend.
"Against challenging market conditions the Credit Agricole Group will post a profit for 2011" despite its main listed entity suffering a loss due to exceptional write downs of 2.5 billion euros.
The bank earned 3.3 billion euros in net profit for the first nine months of the year.
"The Board of Directors will propose not paying a dividend at the general shareholders meeting," it added in a statement.
It said 2,350 jobs would go as it seeks to adapt to changing market and regulatory conditions, with 1,750 to go from its corporate and investment bank Cacib which will now focus on distribution and serving major clients.
The other 600 posts are to go from consumer finance. Some 850 jobs are to be cut in France.
Credit Agricole said it would raise its common equity Core Tier 1 capital ratio to 10 percent by the end of 2013, above the 9.0 percent required from European banks as of July 2012.
It said it has also reduced its financing needs by over 9.0 billion euros, nearly a fifth of the 50 billion euros reduction it targetted in September.
Credit Agricole, one of the biggest banks in Europe by capitalisation, employs 160,000 people around the world, a third of them outside of France, while Cacib employs about 15,000 people globally, including 4,600 in France.
Like other French banks, Credit Agricole has been hit by its exposure to Greek sovereign debt in the eurozone debt crisis and last month revealed a 60 percent write-down of its holdings of Greek bonds.
Moody's rating agency earlier this month downgraded its credit rating on Credit Agricole's long-term debt by one notch to Aa3, as it also announced downgrades on two other leading French banks, BNP Paribas and Societe Generale.
BNP Paribas expects to cut 1,400 jobs globally, mainly in its corporate and investment bank CIB, unions said last month, while Societe Generale has also warned unions of plans to cut several hundred jobs.
© 2011 AFP