Merger Progress Questioned After Top Man Goes

The Wall Street Journal reports that many are beginning to wonder what progress has actually been made integrating Credit Agricole and Credit Lyonnais following their merger earlier this year. The resignation last week of Credit Agricole's deputy chief executive, Dominique Ferrero, the man tasked with spearheading the merger, has made some think that not very much progress has been made.

Ferrero is said to have quit during a three hour board meeting last week. It is believed that his relationship with Credit Agricole chief executive Jean Laurent had become strained.

In a related story, the French government has now signed off on a deal to allow certain French groups to pay $770m to settle charges that Credit Lyonnais was in breach of US banking regulations when it acquired Executive Life in 1991. US prosecutors have now unsealed criminal indictments against two former chairmen of the bank, Jean Peyrelevade and Jean Yves Haberer, and four others. They were indicted on charges of conspiracy, mail fraud, wire fraud and making false statements.

In the meantime, America's Federal Reserve has fined Credit Lyonnais $100m as a result of the Executive affair and is seeking to bar Peyrelevade from the US banking industry and impose a $500,000 civil penalty on him. Peyrelevade has always denied any wrongdoing.

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