C.Agricole cash call as Europe's banks bleed again

By Steve Slater

LONDON (Reuters) - French bank Credit Agricole joined the growing list of lenders asking shareholders for billions of euros in extra cash while a trio of other European banks also revealed new scars from the credit crunch on Tuesday.

Agricole (CAGR.PA), France's biggest retail bank, announced a 5.9 billion euros (4.7 billion pound) rights issue due to further writedowns at its Calyon investment banking arm of 1.2 billion euros during the first quarter.

French rival Societe Generale (SOGN.PA), Belgian-Dutch group Fortis (FOR.BR) and Alliance & Leicester ALLL.L also revealed combined writedowns of almost $3 billion (1.54 billion pounds) as the impact of the U.S. housing market crisis and subsequent credit crunch spread further across Europe.

After taking big hits, banks are asking shareholders to rebuild their capital cushion as the threat of further losses looms and banks' ability to rebuild their balance sheet will be hampered by reduced earnings in coming years.

Agricole shares were down 6 percent by 10 a.m., while Alliance & Leicester tumbled 9 percent and SocGen and Fortis were off by more than 1 percent. The DJ European bank index .SX7P was down 0.7 percent.

Speculation about big losses at Agricole and the ousting of Calyon Chief Executive Marc Litzler has gathered pace in recent days, forcing the bank to bring forward headline earnings by two days.

Agricole's statement made no mention of Litzler's position, but a banking industry source close to Calyon told Reuters on Monday that media reports of Litzler's departure were "realistic".

Agricole said it planned to lower Calyon's risk profile and cut costs at the division.