Trio of lenders report slump in Q1 earnings
Societe Generale SA, Fortis and Credit Agricole SA, three of Europe's biggest banks, said first-quarter earnings declined after losses in the credit markets.
Net income at Paris-based Societe Generale, France's second-largest bank by market value, fell 23 percent to 1.1 billion euros, and Fortis, based in Amsterdam and Brussels, said earnings declined 31 percent to 808 million euros. Credit Agricole reported a 66 percent drop in profit and also announced plans to raise 5.9 billion euros to replenish capital. Credit Agricole fell the most in five months in Paris trading.
Societe Generale disclosed earnings as Frederic Oudea succeeds Daniel Bouton as chief executive officer and the company tries to recover from 3.35 billion euros of fourth-quarter losses caused by alleged unauthorized stock trades by Jerome Kerviel. Fortis has lost 39 percent of market value since it announced plans last year to buy part of ABN Amro Holding NV in the biggest banking takeover.
Fortis sold 13.4 billion euros of stock to help finance the ABN Amro takeover. While funding for the acquisition is complete, Fortis is seeking as much as 3.5 billion euros to strengthen its capital by selling assets and notes, Chief Financial Officer Gilbert Mittler said yesterday.
Fortis, formed in 1990 through the merger of the Dutch insurance company NV Amev, Belgian insurer AG Group and the Dutch bank VSB, fell 1.7 percent to 16.66 euros in Brussels trading, valuing the company at 37 billion euros. Results from banking fell 20 percent and earnings at the insurance unit dropped 38 percent.
Agencies
(China Daily 05/14/2008 page16)
