French banking group Crédit Agricole is weighing plans to offload stakes in its network of regional banks in order to free up capital and simplify its structure.
Crédit Agricole currently comprises a network of 39 regional French mutuals which hold a 56% stake in CASA, the listed central body, through a holding company. The listed group in turn, owns a 25% holding in the mutuals.
The proposed plan would allow each of the regional lenders to acquire back the 25% holding owned by Crédit Agricole.
"This project would de facto lead to the cancellation of the Switch mechanism linked to the holding of these securities. This project which would bear no impact on the Group’s solvency and no significant tax impact, would reinforce the financial flexibility of Crédit Agricole SA, allowing the acceleration of the prudential objectives as announced on 22 December, and the improvement of the quality of its capital," the bank said in a statement.
The deal is expected to be valued at about EUR17bn.
The latest proposal to simplify the bank’s complex ownership structure revives a plan that was rejected following objections from the European Central Bank last year.