Credit Agricole's Q2 profit doubles as state cushions COVID-19 pains
- Like rivals, including Spain's BBVA and BNP Paribas which slashed provisions, the lender said its cost of risk - that reflects provisions against loan loss - was down 66.8%, while revenue rose by 18.8%
PARIS: French lender Credit Agricole reported a two-fold rise in its second-quarter profit on Thursday, on lower COVID-19 pandemic-related charges against bad loans as banks benefited from a government support-led improving economic environment.
Although the health crisis looms over the economy, unprecedented government support across Europe, from worker furlough schemes to assistance for businesses, have helped borrowers keep up repayments, allowing banks to shield profits and lower provisions.
Credit Agricole, France's second-largest listed bank, said its net income rose to 1.97 billion euros ($2.33 billion) in the quarter from 954 million euros a year ago.
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Like rivals, including Spain's BBVA and BNP Paribas which slashed provisions, the lender said its cost of risk - that reflects provisions against loan loss - was down 66.8%, while revenue rose by 18.8%.
When asked about the outlook on provisions, Credit Agricole SA CEO Philippe Brassac told reporters he was confident for the second half of the year but declined to provide a guidance.
"The state takes action. It does it efficiently. This gives a safer risk paradigm for banks", Brassac said.
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