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Credit Agricole to unveil job cuts: union

Passers-by walk in front of a branch of French bank Credit Agricole in Marseille
Passers-by walk in front of a branch of French bank Credit Agricole in Marseille

By Lionel Laurent and Matthieu Protard

PARIS (Reuters) - French bank Credit Agricole will unveil a restructuring on Wednesday, a trade-union representative told Reuters, and the number of jobs cuts could reach around 2,000, the Figaro later reported.

"The exact number (of cuts) will be disclosed to us tomorrow," said Credit Agricole union representative Joel Gerin.

The Figaro said in its Wednesday edition, made available late on Tuesday, that no more than a quarter of the cuts would be in France where there would be no forced departures.

A spokesperson for Credit Agricole declined to comment on the report.

The Figaro said the bulk of the cuts, or 1,500 jobs, would affect Credit Agricole's corporate and investment banking unit, confirming information provided to Reuters by sources close to the company.

Credit Agricole, which is emulating similar moves by BNP Paribas and Societe Generale , is in the early stages of an overhaul under new Chief Executive Jean-Paul Chifflet, who has espoused a back-to-basics retail banking strategy at odds with his predecessor's ambitions to make the bank a major global player in financial markets.

The bank's board is to hold a meeting on Tuesday before Wednesday's expected announcement, another union source told Reuters.

"Tomorrow (Wednesday) there will be the new strategic plan for Credit Agricole's corporate and investment bank ... There will be an impact on jobs and on our presence in national markets," the source said.

A report by French radio station BFM earlier said Credit Agricole, which has restructured its investment bank in the wake of the 2008 financial crisis, will exit some 15 out of 50 countries where its corporate and investment bank is present.

The bank has said it will close its 60-year-old South African unit as it scales back global operations to meet new capital adequacy rules.

Union representative Gerin declined to comment on BFM's report that the number of job cuts could be 1,000, saying any number being circulated was "rumor and speculation."

BNP Paribas and Societe Generale are cutting jobs along with many other banks in Europe that have to reduce costs as a result of the euro zone debt crisis.

Unlike BNP and SocGen, Credit Agricole -- majority owned by a robust network of regional banking co-operatives -- is not being asked to raise any extra regulatory capital by mid-2012 as part of a Europe-wide plan to strengthen bank balance sheets.

The regulator only "stress-tests" the parent network, rather than the listed vehicle, which has a lower core capital ratio.

But with credit markets virtually closed to euro zone banks, all French lenders have announced cutbacks in lending to slash debt and wean themselves off once-cheap wholesale funding, especially in U.S. dollars.

Data released by the Bank of France on Tuesday showed French banks' borrowing from the European Central Bank in October was 158.5 billion euros ($207.4 billion), treble the 53 billion euros borrowed in October 2010.

And given Credit Agricole's substantial exposure to Italian sovereign debt and the crisis-racked Greek economy, via its local subsidiary Emporiki, the bank is still seen as highly sensitive to a deepening of the euro zone debt crisis.

"We're preparing ourselves for difficult quarters to come ... The environment remains delicate and complex," CEO Chifflet said last month.

($1 = 0.7641 euros)

(Reporting by Lionel Laurent and Matthieu Protard in Paris; Editing by Jane Merriman, Mark Potter, David Hulmes and Steve Orlofsky)

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