Crédit Agricole S.A. : Solid results in spite of the crisis

Paris, 5 March 2008

FY 2007 results: 4,044 million

• Net banking income : €16,768 million (+3.6%)
• Net income - Group share : €4,044 million (- 16.8%)
• Annualised ROE after tax : 12.2%
• Proposed dividend : €1.20 per share (+4.3%)
  
  Results for the 4th quarter of 2007(Q4-07 compared with Q4-06)
• Net income (Group share) : (€857 million)
  
  Crédit Agricole S.A.’s board of directors, chaired by René Carron, met on 4 March 2008 to review the results for the fourth quarter of 2007 and to approve the accounts for the year ended 31 December 2007.
  
  Over the full year 2007, Crédit Agricole S.A. generated net income (Group share) of €4,044 million. These results, representing a 16.8% decline, still demonstrate the Group’s resilience in a climate of severe international financial crisis. They reflect the strength of the Group’s model, which is based on maintaining an even balance among the three business lines - retail banking, specialised financial services and corporate and investment banking. The negative impact of the crisis on revenues in capital market activities was offset by solid growth across all other business lines. Overall, net banking income rose by 3.6%.
  
  Excluding the impact of the crisis, net banking income would have risen by 25.5% and gross operating income would have increased by 30.5%. This very good operating performance attests to the quality of the different business lines’ growth engines and particularly international contributions. This applied especially to international retail banking, specialised financial services and asset management.
  
  In 2007, the Group firmly established the strength of its international presence in retail banking. With the successful and rapid integration of the Cariparma FriulAdria branch networks in Italy, that country became the Group’s second largest domestic market; Emporiki’s in-depth transformation underpins prospects for profitable growth in both Greece and the Balkans; the equity investment in Banco Espirito Santo in Portugal proved to be highly profitable; and the subsidiaries in Egypt and Morocco continue to expand at a fast pace. Whenever possible, Crédit Agricole S.A. applies the "distributor/producer" model to its foreign networks which it has so successfully implemented in France and as is already the case in consumer credit and insurance.
  
  In specialised financial services, 2007 was the first full year for the joint venture with Fiat, FGAFS, which delivered stronger-than-expected growth. In the Netherlands, the Group acquired two consumer finance companies, which combined with the previously owned Dutch entity, is now the No. 1 consumer finance company in the country.
  
  In asset gathering business line, Crédit Agricole Asset Management successfully reconfigured its asset management business in Italy at the end of 2007. With €26 billion in new inflows, the new CAAM SGR subsidiary is the leading foreign asset management company in Italy. The Group took many initiatives in this business line. It acquired a private bank in Luxembourg, thereby consolidating its presence there. At the end of the year, it created a life insurance company in Japan, the world’s second largest market in this sector.
  
  As regards the Regional Banks, 2007 was a good year in terms of deposits. In addition, their contribution to the Group’s results is up considerably. 2007 was also the start of the implementation of the LCL competitiveness plan, which is designed to reinforce the bank’s reaffirmed business momentum while keeping it under stringent and controlled management.
  
  On the whole, several major transformations were completed in 2007. The Group took a both pro-active and responsive approach to perfect its reconfiguration.
  
  Fourth-quarter results were severely affected by the crisis in the structured credit markets and Calyon booked €3.3 billion in exceptional impairment charges relating to its capital market activities. As a result, Crédit Agricole S.A.’s net income (Group share) was a loss of €857 million for the quarter.
  
  In order to fully support the business lines’ growth going forward, Georges Pauget, Chief Executive Officer, proposed to the Board of Directors, that a part of the capital gains on disposal from two transactions completed in January 2008 (the disposal of the holding in Suez and Calyon Financial’s contribution to the creation de Newedge) be allocated to strengthening risk management and control systems within the Group; an initiative with which the Board unanimously agreed.