Bloomberg reports that after shrinking units, reinforcing capital and seeking more stable funding sources for their businesses in the so-called euro-area periphery, the banks - which report first-quarter results starting this week - are contending with slowing lending growth, rising bankruptcies and doubtful-loan losses in France, their biggest market for deposits and revenue.
With French economic growth stalled over the last two years and joblessness at a record high, the total retail-banking revenue at the country’s top five lenders - including Groupe BPCE and Credit Mutuel-CIC - last year declined for the first time in two decades, and $6.5bn in operating profit from such business may vanish by 2015, according to Munich-based Roland Berger Strategy Consultants.
'It’s the end of an Eldorado', Fabrice Asvazadourian, a senior partner in Paris for Roland Berger, said in an interview. 'It’s an industry that was accustomed to growth, and now there’s a sudden, sharp brake'.
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image: © Neil Willsey