PARIS – Credit Agricole is aiming for a return on equity of 12 percent through 2016 and will cut fixed costs by 15 percent to achieve it, the head of its investment banking unit told Les Echos newspaper and Agefi newsletter.
"To get there we will tighten our spending, as we are doing across the investment banking unit," Jean-Yves Hocher said in the interview published Wednesday.
Tightened regulation and weak demand have led France's third-largest bank by market value to cut back on equities, derivatives and M&A advisory to focus on a future as a pared-back investment bank catering to French and other European clients.
Hocher said the French bank had already exited its derivatives business and was selling some funds, while looking to outsource some back-office functions.
"These cost reductions will not result in another lay-off plan," said Hocher.
He said brokerage unit Newedge was being split into an asset execution specialist and a clearing business and a sale of Newedge "is not on the agenda".
"We want to strengthen this business which suffered from the strong drop in the financial markets," he said.
(Reporting by Leila Abboud; Editing by Tom Pfeiffer)