Finance
Credit Agricole's profit falls 39% on Banco BPM charge, higher costs
Published by Global Banking and Finance Review
Posted on February 4, 2026
3 min readLast updated: February 4, 2026
Quick Summary
Credit Agricole's Q4 profit fell 39% due to a Banco BPM charge, higher costs, and car-leasing losses. The bank aims to strengthen its position in Italy.
Credit Agricole Sees 39% Profit Decline Due to Banco BPM Charge
Credit Agricole's Financial Performance Overview
By Mathieu Rosemain
PARIS, Feb 4 (Reuters) - Credit Agricole reported a 39% fall in fourth-quarter profit on Wednesday, hit by a one-off charge related to the French bank's increased stake in Italy's Banco BPM, rising costs and losses at its car-leasing business.
France's third-largest listed lender said net income dropped to 1.03 billion euros ($1.22 billion), narrowly above analyst expectations of 996 million euros. Revenue fell 1.8% to 6.97 billion euros, beating the 6.78 billion euro consensus.
Impact of Banco BPM Stake Increase
The bank had to book a 607 million euro accounting charge after raising its stake in Banco BPM above 20%, triggering a change in how it accounts for the investment. The adjustment is non-recurring and does not involve any cash outflow.
Investment Banking Performance
Like several European lenders, Credit Agricole has benefited from higher interest rates and resilient loan demand, particularly in its international and corporate businesses, even as French retail margins have remained under pressure.
Credit Agricole is also focused on trying to protect and strengthen its position in Italy's banking industry amid a wave of consolidation in a market crucial for the lender.
CEO Olivier Gavalda stated that the bank would seek greater influence at BPM. "We demand to have a position on the board that equals our 20%... so 20% representation on BPM's board," Gavalda told reporters.
Banco BPM is set to strengthen minority shareholders' representation by doubling to six the maximum number of board seats they can secure, documents showed earlier this month.
INVESTMENT BANKERS UNDERPERFORM RIVALS
Credit Agricole's investment banking unit posted record fourth-quarter, though growth in its fixed income, currencies and commodities business was weaker than at Deutsche Bank and Wall Street rivals JPMorgan and Goldman Sachs.
Operating Expenses and Future Outlook
Operating expenses rose 4.7% to 4.1 billion euros, exceeding analyst expectations of 3.9 billion euros. The increase was partly due to 65 million euros in restructuring costs in Italy aimed at boosting the bank's "digital dimension," Chief Financial Officer Clotilde L'Angevin said.
L'Angevin said the bank would eventually cut staff numbers in Italy by 500 to 11,500.
Credit Agricole's car-leasing joint venture with automaker Stellantis, Leasys, recorded a 111 million euro loss in the fourth quarter after writing down the value of secondhand cars.
Credit Agricole proposed a dividend of 1.13 euros per share for 2025, up 3% year-on-year and in line with expectations.
($1 = 0.8462 euros)
(Reporting by Mathieu Rosemain; Editing by Tommy Reggiori Wilkes)
Key Takeaways
- •Credit Agricole's profit fell 39% in Q4.
- •Banco BPM charge significantly impacted earnings.
- •Investment banking underperformed compared to rivals.
- •Operating expenses rose due to restructuring in Italy.
- •Car-leasing venture with Stellantis posted a loss.
Frequently Asked Questions about Credit Agricole's profit falls 39% on Banco BPM charge, higher costs
1What is net income?
Net income is the total profit of a company after all expenses, taxes, and costs have been deducted from total revenue. It is a key indicator of a company's profitability.
2What is an accounting charge?
An accounting charge is an expense that a company records on its financial statements, which reduces its net income. It can be a one-time event or recurring.
3What are operating expenses?
Operating expenses are the costs required to run a business's core operations, excluding the cost of goods sold. They include rent, utilities, salaries, and other administrative expenses.
4What is investment banking?
Investment banking is a division of banking that helps companies raise capital by underwriting or acting as an agent in issuing securities. It also provides advisory services for mergers and acquisitions.
