Finance
Analysis-Credit Agricole's 'tortoise' strategy pays off in Italy's M&A contest
Published by Global Banking and Finance Review
Posted on July 31, 2025
5 min readLast updated: January 22, 2026
Global Banking and Finance Review
Company
Published by Global Banking and Finance Review
Posted on July 31, 2025
5 min readLast updated: January 22, 2026
Credit Agricole's patient M&A strategy in Italy proves successful, contrasting with UniCredit's failed aggressive bid for Banco BPM.
By Valentina Za, Mathieu Rosemain and Giuseppe Fonte
MILAN/PARIS (Reuters) -European bank CEOs studying M&A moves at a time when some EU governments want a say in any reshaping of their banking industry should look at the dealmaking playbook of Credit Agricole.
The French group has become a key actor in Italy's banking consolidation saga, playing a role in the fate of Banco BPM, which UniCredit had tried to swallow up in the face of Italian government opposition.
UniCredit upset Rome with its surprise swoop on Banco BPM in November, derailing a government project to promote an eventual tie-up between BPM and state-backed Monte dei Paschi di Siena.
In contrast, Credit Agricole's patient, non-aggressive expansion strategy has, over almost two decades, turned Italy into the French group's biggest market outside France, accounting for 15% of its reported profit in 2024.
A consistent approach based on a cooperative attitude towards Italian authorities has turned Credit Agricole (CA) into a reliable counterpart for successive administrations in Rome, government officials and bankers familiar with CA's strategy, as well as two sources within the company, told Reuters.
"To be very clear: the government doesn't look at bankers' nationality but at their ability to ... gather savings, protect them and lend them out," Italian Economy Minister Giancarlo Giorgetti said earlier in July.
Since the end of 2020, CA's retail business in Italy has added some 15 billion euros in customer loans. The domestic franchise of market leader Intesa Sanpaolo has shrunk its loan book by twice that amount and UniCredit by some 22 billion euros, the banks' financial statements showed.
UniCredit, Italy's second biggest bank, last week dropped its Banco BPM bid, blaming Rome's intervention for thwarting the project after government-imposed terms ensnared it in a legal battle, fuelling concerns among UniCredit's directors about a strategy that had antagonised the government.
CA also posed a hurdle, a person directly involved in the process said, adding that UniCredit failed to agree terms under which the French bank would tender its 19.8% BPM holding to acquire a stake in UniCredit.
Credit Agricole SA, the listed entity of the mutual banking group, this month sought European Central Bank authorisation to cross the 20% ownership threshold in Banco BPM, saying it would go just above that level and ruling out a full takeover.
CA, also known as "la banque verte" because of its historic ties to farming, partners with BPM on insurance and consumer finance. It became an investor in April 2022 soon after another unsuccessful takeover attempt by UniCredit.
Once it gets ECB approval, the French bank is set to increase its BPM holding to just below the mandatory takeover threshold of 25%, two people with knowledge of the matter said.
CA, responding to a Reuters' request for comment, referred back to its July 11 statement, in which it said it would keep below that threshold.
SMALL STEPS
CA is left to rely on its small-step expansion blueprint given the backdrop of tense relations between Italy and France over a wide range of issues, including migration, security and civil rights, as well as Rome's banking sector strategy and special powers for vetting corporate deals, which have prevented more ambitious moves, the two people said.
The bank has managed to keep governments of different colours on its side by focusing on its commercial interests, seeking distribution deals with Italian players to sell its products, plus making small acquisitions to build a local franchise.
"More tortoise than hare," one of the people said.
A decade after entering Italian retail banking, CA acquired three small failing banks in a rescue deal overseen by the centre-left administration of Prime Minister Paolo Gentiloni. In 2021, Mario Draghi's government unconditionally approved CA's takeover of Creval, another lender in Italy's wealthy north.
In December CA held talks with Italy's centre-right government before raising its BPM stake, sources told Reuters at the time.
Now UniCredit has walked away, Banco BPM has said it will explore tie-ups with banks with a similar business model.
CA's increased stake will allow it to remain a significant shareholder in an enlarged BPM, in line with the French group's aim of wielding sufficient authority to protect its commercial partnerships, two bankers familiar with the matter said.
A former CA adviser said the group's consistent leadership and corporate culture allowed it to successfully roll out its expansion strategy with a view to the long term.
"They know that governments change but they don't. They're the same company, the same culture, the same people: they can wait, years, and strike when the time comes," the person said.
($1 = 0.8740 euros)
(Reporting by Valentina Za in Milan; Mathieu Rosemain in Paris and Giuseppe Fonte in Rome. Editing by Jane Merriman)
Credit Agricole has adopted a patient, non-aggressive expansion strategy, focusing on building relationships with Italian authorities and gradually increasing its market presence.
UniCredit recently dropped its bid for Banco BPM, citing government intervention as a key factor that thwarted the acquisition process.
Unlike UniCredit's aggressive tactics, Credit Agricole's approach has been more collaborative and steady, allowing it to build trust with the Italian government over nearly two decades.
Credit Agricole currently holds a 19.8% stake in Banco BPM and is seeking to increase this holding with European Central Bank approval, aiming to stay below the mandatory takeover threshold of 25%.
The Italian government has been supportive of Credit Agricole's operations, focusing on the bank's ability to gather and protect savings, rather than its nationality.
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