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Natixis Third-Quarter Profit Falls 59% on Own-Debt Charge

Nov. 14 (Bloomberg) -- Natixis SA, the investment-banking unit of France’s second-largest lender by branches, said third-quarter profit fell 59 percent as a charge related to its own debt outweighed a rebound in trading revenue.

Net income fell to 142 million euros ($181 million) from 344 million euros a year earlier, the Paris-based bank said in an e-mailed statement today. That missed the 154 million-euro average estimate of four analysts surveyed by Bloomberg.

Natixis and its parent, Groupe BPCE, entered Europe’s sovereign-debt crisis with smaller risks compared with French rivals. Credit Agricole SA, France’s third-largest bank by market value, last week posted a 2.85 billion-euro quarterly loss tied to the sale of its Greek unit Emporiki Bank.

Natixis booked a 181 million-euro pretax accounting charge stemming from the theoretical cost of buying back its own debt as market prices fluctuate. So-called credit valuation adjustments require banks to book losses when the value of their debt rises, and gains when it declines, on the theory that a loss, or profit, would be realized were the bank to repurchase that debt.

Revenue from Natixis’s capital-markets business more than doubled to 329 million euros as the interest-rate, foreign exchange, commodities and treasury activities “turned in satisfactory performances,” the bank said.

To contact the reporter on this story: Fabio Benedetti-Valentini in Paris at fabiobv@bloomberg.net

To contact the editors responsible for this story: Frank Connelly at fconnelly@bloomberg.net; Edward Evans at eevans3@bloomberg.net

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