Thursday, February 23, 2012

Europe's banks bleed from Greek debt crisis

(Reuters) - Greece's debt problems drove a slew of heavy losses across the European banking sector on Thursday, and bosses warned the euro zone crisis would continue to threaten earnings.

From France to Germany, Britain to Belgium, some of the region's biggest banks lined up to reveal billions of euros lost through writedowns on Greek loans.

"We are in the worst economic crisis since 1929," Credit Agricole (CAGR.PA) chief executive Jean-Paul Chifflet said.

Credit Agricole reported a record quarterly net loss of 3.07 billion euros ($4.06 billion), performing worse than expected from the cost of shrinking its balance sheet and after a 220 million euro charge on its Greek debt.

"We think 2012 is going to still be a tense period," Chifflet said, adding: "We're hoping that our results will be largely better than in 2011.

Europe's banks have already written down billions of euros from losses on Greek government bonds and loans, and a deal agreed this week with its creditors will inflict losses of 74 percent on bondholders. Read More