ROME/PARIS, Dec 23 (Reuters) – Credit score Agricole (CAGR.PA) on Friday struck a long-term bancassurance partnership with Italy’s Banco BPM (BAMI.MI), strengthening ties with the nation’s quantity three lender, through which it’s already the highest investor.
The French financial institution, which took a 9.2% stake in Banco BPM in April, has stated it invested to develop their business partnerships which beforehand centered on shopper credit score.
Nevertheless, given the French group’s presence in Italy, the funding in Banco BPM has stoked hypothesis {that a} full takeover might observe.
The deal introduced on Friday permits the supply of non-life insurance coverage merchandise and associated providers via Banco BPM’s networks for a 20-year interval.
It additionally stipulates that the French financial institution’s Credit score Agricole Assurances (CAA) division will purchase from Banco BPM a 65% stake in its non-life insurance coverage enterprise.
That at present includes the non-life operations of its former Covea three way partnership, to which Banco BPM will add the non-life enterprise with Cattolica, now a unit of Generali (GASI.MI), as soon as it workouts a repurchase possibility.
Banco BPM stated the deal valued the 2 insurance coverage firms at 400 million euros ($424 million), that means Credit score Agricole should pay 260 million euros for almost all stake.
THIRD FORCE
Banco BPM CEO Giuseppe Castagna, up for reappointment in April, has sought to make his lender the centrepiece of a 3rd giant banking group in Italy, to compete with heavyweights Intesa Sanpaolo (ISP.MI) and UniCredit (CRDI.MI).
Given its center rating, Banco BPM is, nevertheless, seen as a possible takeover goal for UniCredit, Credit score Agricole or one other participant. Its shares have risen greater than 25% this 12 months to worth it at over 5 billion euros.
Credit score Agricole has all the time denied desirous to raise its stake above 10%, and key figures within the new centre-right Italian authorities have been important of its enlargement plans in Italy.
Sources have advised Reuters that Credit score Agricole was eager to keep away from friction with the federal government of a rustic which is its greatest overseas market.
With Rome needing to discover a purchaser for state-owned Monte dei Paschi (BMPS.MI), Banco BPM is seen as a potential associate for the Tuscan lender in a transfer that will permit it to bulk up and be much less of a takeover goal.
“Credit score Agricole’s selections to construct a 9% stake in Banco BPM and strike a bancassurance settlement with them are very strategic, additionally in gentle of their three way partnership in shopper lending,” stated Noemi Peruch, banking analyst at Mediobanca.
Moreover defending Credit score Agricole’s native pursuits, the strikes might additionally pave the best way for an eventual takeover of Banco BPM, similarly to the French group’s earlier acquisition of Credito Valtellinese.
“Credit score Agricole usually performs the lengthy recreation and sees Italy as a key market,” Peruch stated.
($1 = 0.9424 euros)
Reporting by Sudip Kar-Gupta, Alvise Armellini, Andrea Mandalà, Valentina Za, Pablo Mayo Cerqueiro, Enhancing by Keith Weir and Mark Potter
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