PARIS (Reuters) - Credit Agricole beat fourth quarter net profit expectations and achieved its profit goals a year ahead of target, sending shares in the French bank higher.
It outperformed rivals BNP Paribas and Societe Generale, both of which lowered their targets.
“The strong growth of underlying net income was achieved despite a much less favourable environment,” Chief Executive Philippe Brassac said.
Net profit jumped to €1 billion (£878 million) from €387 million a year earlier, when it had to book almost €400 million in tax-related charges.
That topped the €795 million expected by analysts polled by Infront Data.
Credit Agricole shares were up 1.4 percent in early trading.
Credit Agricole surpassed targets set three years ago for 2019 on profitability and revenue growth.
Revenue grew by an average 4.3 percent a year in 2016-2018, while return on tangible equity rose to 12.7 percent. The bank will issue new targets for 2019-2022 in June.
Most big European banks are struggling to find new profit sources after years of rock-bottom interest rates have limited returns in retail banking.
Credit Agricole depends more on its retail network, insurance and consumer lending businesses than its French rivals.
Its market activities also suffered from a downturn in late 2018, but the bank did not make a loss, unlike some of its rivals, CFO Jerome Grivet said.
“A robust set of results driven by good cost management and resilient revenues,” Jefferies analysts wrote.
Credit Agricole also raised its dividend by 9.5 percent to 0.69 euro per share, in contrast to rivals which have either kept their payouts unchanged or offered to pay part of it in shares to protect cash.
“The banking sector can be seen as the new utility sector. Yes, they are overcapitalised, but they have a high dividend yield and steady income stream,” said Ion-Marc Valahu, fund manager at investment firm Clairinvest, whose portfolio of European bank stocks includes Credit Agricole.
Reporting by Inti Landauro and Matthieu Protard; additional reporting by Sudip Kar-Gupta; editing by Jason Neely