Exclusive: Credit Agricole exits government bond dealer roles in Austria, Ireland

Fri Jan 13, 2017 4:50am EST
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By Abhinav Ramnarayan

LONDON (Reuters) - Credit Agricole's investment banking arm said on Friday it had decided to cease acting as a primary dealer in government bonds for Austria and Ireland, and in treasury bills for the Netherlands.

The bank is the latest to have given up primary dealer roles in Europe, a trend that threatens to increase liquidity constraints and could eventually make it more expensive for some countries to borrow.

The bank reviewed its government bond business to take account of the impact of new regulations on banks' balance sheets and profitability, a spokeswoman for the bank said in an emailed statement to Reuters.

"Credit Agricole CIB remains committed to the Government Bonds business. This activity remains a core business of the bank and is part of its fixed income franchise," she said.

Of the other investment banks to have taken similar decisions, the most notable was Credit Suisse, which in 2015 pulled out of making markets for most European countries.

Societe Generale withdrew from the UK later the same year, ING quit Ireland, Commerzbank left Italy, and Belgium did not re-appoint Deutsche Bank as a primary dealer and dropped Nordea as a recognized dealer.


Logos are seen on a Credit Agricole branch in Paris, France, August 4, 2015.      REUTERS/Stephane Mahe/File Photo