Credit Agricole Said in Cheuvreux Talks With Kepler, Viel

Credit Agricole SA is holding talks with brokers as it considers exiting the unprofitable trading and research activities of its CA Cheuvreux unit, according to three people familiar with the plans.

Credit Agricole, France’s third-biggest bank, is in talks with firms including Kepler Capital Markets SA, Viel & Cie (VIL) and Jefferies Group Inc. (JEF), said one person, who declined to be identified because the discussions are private. An agreement may be reached for the equity broking activities as soon as mid- July, two of the people said.

Representatives of Paris-based Kepler and Jefferies declined to comment. An official at Viel was not immediately available for comment.

Credit Agricole Chief Executive Officer Jean-Paul Chifflet is trimming the bank’s balance sheet and shrinking investment banking as the crisis curbs access to funding and regulators impose stricter capital requirements. A drop in stock trading volumes combined with a squeeze in commissions has prompted lenders including UniCredit SpA (UCG), which combined its broking with Kepler, and Royal Bank of Scotland Group Plc to abandon their brokerage businesses.

Cheuvreux, which covers 600 stocks from 13 offices, posted a 53.9 million-euro ($68 million) loss last year, deeper than its 12.5 million euro loss in 2010. Credit Agricole’s profit dropped 75 percent in the first quarter hurt by losses at the bank’s Greek lender, Emporiki Bank of Greece (TELL) SA.

Cheuvreux may be sold for less than its shareholders’ equity because it’s unprofitable amid high fixed costs and a tough environment for stock brokerages, one of the people said. Just two bidders are still in the running, that person said. Cheuvreux reported shareholder equity at the end of last year at about 165 million euros, down from 219 million euros the year before.

To contact the reporters on this story: Francois de Beaupuy in Paris at; Elisa Martinuzzi in Milan at; Jacqueline Simmons in Paris at

To contact the editors responsible for this story: Frank Connelly at; Jacqueline Simmons at

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