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Credit Agricole posts 53% profits increase

One of France's largest banks Credit Agricole has reported a huge rise of 53 per cent in net profits over the first quarter, thanks to increased revenue from investment banking and asset management services.

Net income rose from $1.2 billion a year ago to $1.8 billion, beating analysts' estimates, which predicted net profits more in the region of $1.1 billion.

In welcoming the profits news, Credit Agricole chairman Rene Carron said that the strong performance was good news for the bank's plans for growth.

"Credit Agricole's remarkable overall performance in the first quarter of 2006 surpassed targets under the development plan," he said

"These results, which were aided by favourable business conditions, attest to the viability of our policy of controlled growth."

The Paris-based bank benefited significantly from rising equity markets and an increase in corporate finance activity – boosting its investment banking business which has lagged behind its larger European competitors in recent years, including rival BNP Paribas and Switzerland's UBS.

Credit Agricole's strong performance has led to suggestions that it may consider some major takeovers in the near future, with the UK-based Alliance & Leicester said to have been a recent takeover target.