Credit Agricole seeks $7.72 billion in new capital

The planned capital increase is larger than the 5.5 billion euros ($8.5 billion) raised by Societe Generale this year to cover losses of nearly 5 billion euros (more than $7 billion) from a massive trading scandal.

Credit Agricole said the rights offer should take place before the summer, subject to market conditions. It did not specify which assets it plans to sell.

Agricole had already made an advance statement of the planned capital increase on Tuesday after a leaked report was published in the French business daily Les Echos.

Regional banks that own around 54 percent of Agricole will subscribe to the capital increase.

Agricole, which owns France's biggest retail bank network, named Patrick Valroff as the new head of Calyon, its investment banking arm. He replaces Marc Litzler.

Agricole said subprime-related losses at Calyon, its investment banking arm, amounted to 1.2 billion euros ($1.9 billion) in the first quarter. It said it plans to restructure its investment banking activities and promised more details in September.

Calyon swung to a net loss of 795 million euros ($1227.4 million) in the first quarter from a net profit of 539 million euros in the first quarter of 2007.

The announcement came as Agricole confirmed first-quarter profit fell to 892 million euros ($1.38 billion) from 2.66 billion euros a year earlier.

Write-downs and losses related to the U.S. subprime market collapse and the resulting turmoil in financial markets have hit some of the industry's biggest players. Citigroup Inc. plans to shed nearly $500 billion in assets as it tries to rebound from massive losses tied to deterioration in the credit markets.

SocGen said Tuesday first-quarter profit fell 23 percent to 1.1 billion euros ($1.7 billion). France's largest bank, BNP Paribas SA, said Wednesday its first-quarter net profit declined by 21 percent to 1.98 billion euros ($3.06 billion).

Credit Agricole SA shares fell 0.9 percent to 19.32 euros ($29.83) in morning trade.