By Mathieu Rosemain

PARIS (Reuters) – Credit Agricole SA shares fell nearly 6% after the French bank reported mixed quarterly results, marked by record investment banking sales, a slightly smaller-than-expected drop in earnings and a surprise fall in insurance revenues.

Bank-wide third-quarter revenue also missed estimates, dragged down by its consumer finance and insurance businesses. The latter reported a 1.2% drop in sales, which it linked to a change in claims tied to policies aimed at protecting farmers against losses in crop production.

“Revenue could have been better. We expected insurance revenue to be a particular highlight of CASA’s (Credit Agricole SA’s) Q3 results. This was not the case,” Jefferies analysts said in a note to clients.

Credit Agricole’s shares, which have lagged the STOXX Europe 600 Banks index so far this year with a 3% gain compared with a 23% for the benchmark, lost more ground on Wednesday as other stocks rallied in the wake of the Donald Trump’s victory in the U.S. presidential election.

Pressed by analysts in a call to say whether climate change could drive higher insurance claims in the future, deputy CEO Jerome Grivet said they could increase further but added that the group would “align the pricing” accordingly.

Net profit at France’s second-largest listed lender by market value fell 4.7% in the July-September quarter from a year earlier to 1.67 billion euros ($1.8 billion) after a provisioning boost in 2023 linked to French savings accounts disappeared. It still came above the 1.58 billion-euro analyst consensus compiled by the company.

The listed entity of Credit Agricole Group reiterated that it was on track to meet its 2025 financial targets a year early, including annual underlying net income of more than 6 billion euros.

Credit Agricole’s results contrast with those of many European banks including rival Societe Generale, which beat quarterly forecasts thanks to solid net interest income and rising investment banking revenues.

The corporate and investment banking unit was also a bright spot for Credit Agricole, its sales rising a forecast-beating 8.2% to 1.53 billion euros, compared with a 4.9% rise at rival Societe Generale and 9% at BNP Paribas.

Credit Agricole’s revenue from trading in fixed income, currencies and commodities rose by 6.2%, below BNP’s 12% growth but close to Societe Generale’s 6.1%.

RETAIL DROP

The lender’s overall drop in earnings relates to the bank previously putting money aside to protect against higher interest rates for French savings accounts that customers use to buy a house.

The release of those provisions added more than 200 million euros to last year’s third-quarter numbers.

Quarterly bank-wide revenue rose 2.3% to 6.49 billion euros, missing the 6.56 billion-euro average analyst estimate after revenue at its French and Italian retail banks contracted.

Sales at Credit Agricole SA’s French retail activities edged down 1.7% in the third quarter. Excluding the effect of the 2023 provisions, they would have been up 3.7% year-on-year, the lender said.

Credit Agricole said its cost of risk – money set aside for bad loans – was 433 million euros, below the 792 million euros expected by analysts.

A planned joint venture with payments company Worldline, CAWL, will be operational by end-March 2025 and has not been delayed by the sudden departure of Worldline’s long-time CEO in September after it issued another profit warning, deputy CEO Olivier Gavalda said.

($1 = 0.9145 euros)

(Reporting by Mathieu Rosemain; Additional reporting by Bertrand de Meyer; Editing by Tommy Reggiori Wilkes, Jan Harvey, Emelia Sithole-Matarise and Tomasz Janowski)