Credit Agricole shares jump on Emporiki sale rumours

The price of shares in Credit Agricole soared Monday on rumours that it might sell its Greek subsidiary Emporiki, while the National Bank of Greece said it had held talks with the French bank. Credit Agricole stock gained 6.91 percent to close at 3.71 euros, posting the biggest rise on the CAC 40, which was up 1.36 percent overall. Kepler Capital Markets trader Benoit Petrarque said to stock had leapt higher "solely on rumours of a divestment of Emporiki." Petrarque said that Credit Agricole might be able to get Emporiki off its balance sheet by offering to pay a buyer 4.0 billion euros ($5 billion). "If ever it manages to get rid of it for less, it would be very good news," he said. Since 2006, Credit Agricole has spent more than 5.0 billion euros to take control of Emporiki and then to shore up the subsidiary's balance sheet. In Athens, National Bank of Greece said: "Following recent publications and a question raised by the Greek Capital Market Commission, NBG informs investors that there have been discussions between the heads of the National Bank and Credit Agricole." It said in a statement at the Athens stock exchange that the talks had concerned "the possibility of future strategic alliances." The bank said that "discussions are, for the time being, at an early stage," and added that it would notify investors immediately in case of a "concrete result." The Greek lender's announcement comes after a Saturday report by the Financial Times that the French group had put Emporiki Bank up for sale and started looking for a buyer earlier this month. According to the business daily, NBG and two of the country's other top lenders -- Alpha Bank and Eurobank EFG -- had expressed interest in taking over Emporiki. Emporiki also confirmed talks were underway with other lenders and Greek banking regulators. "The preliminary discussions are not yet at a stage where a decision can be taken," it said in a statement. "The discussions take place in the context of the processes for the consolidation and the restructuring of the Greek financial sector," it added. NBG's share price jumped by nearly three percent on news of the talks, but later fell back to end the day flat. Athen's FTSEB bank index dropped 2.61 percent. Credit Agricole reported in May a 75-percent drop in first-quarter net profit, as a result of its exposure to the Greek debt crisis. The firm said that total losses on Greece were 940 million euros ($1.2 billion) including costs linked to the Greek sovereign debt swap agreed in March and provisions related to its majority stake in Emporiki.