Crédit Mutuel and Arkéa’s divorce is close to absolute
After four years of drama, the messy divorce between Crédit Mutuel Arkéa and the rest of the Crédit Mutuel group has reached an interlude, with banking regulators now looking at the mechanics of a split.
Crédit Mutuel is the fourth largest retail bank in France, with 29 million customers, 18 million of whom are outside the country.
It has one of the most trusted brand names in France but is involved in a messy drama with more plot lines than a TV soap opera.
Arkéa wants to leave the Crédit Mutuel group, which does not want to see it go.
A spokeswoman for Arkéa said: “At the moment, we are co-operating fully with the European Central Bank (ECB), our regulator, over how the mechanics of the split will operate.
“There is no fixed timeline but obviously we would like the conclusions of the ECB to be as quick as is possible.”
Arkéa, which is prepared to give up the Crédit Mutuel brand for independence, is based in Brest, in Brittany, and has support from Crédit Mutuel local banks in the south west.
Its opponent, known as CM11-CIC, is based in Strasbourg and has most of its support in the east and in the Paris region.
Much has been made of the supposed cultural differences between the east and west.
Parts of the Massif central federation are involved in a sub-dispute, after some local branches refused to accept a vote that it should switch alliance from Arkéa to CM11-CIC. The switch finally took place in September.
What started the bad blood is not clear – some say it was because CIC, which was bought by Crédit Mutuel in 1998 and aligned itself with CM11, started poaching in Arkéa’s areas.
Others say it was simply down to over-inflated egos at the top of the two federations.
Another explanation was that Arkéa, which is one of the leaders in France in using new technology and whose Fortuneo is one of the few online banks making money, became frustrated by the more traditional outlook.
The normally staid financial site La Tribune wrote: “There is a bit in this of battle of Astérix against the Romans, Brexit, Catalonia and bonnets rouges, peppered with explosive ingredients: economic development, competition, jobs, cultural antagonisms and exaggerated personal ambitions.”
It added that there were close links between the leaders of CM11-CIC and government high-flyers from the old Socialist Party, while Arkéa’s top flight worked closely with Jacques Chirac when he was president.
Nicolas Théry, head of CM11-CIC and of the Confédération Nationale du Crédit Mutuel, worked with the present governor of the Banque de France François Villeroy de Galhau, who is also on the board of the European Central Bank, the regulator.
Mr Théry is also close friends with Odile Renaud-Basso, head of France Trésor.
He worked in the finance ministry as part of the socialist Dominique Strauss-Kahn’s cabinet.
By contrast, Jean-Pierre Denis, head of Arkéa, was part of Jacques Chirac’s inner circle, first at the Paris town hall and then in the presidential palace, where he was secrétaire générale adjoint de l’Élysée.
Arguments against a split centre on the received wisdom in European banking circles that the time has arrived for a small number, larger banks, rather than more smaller ones.
Arkéa brushes this aside, saying that on its own it will be the sixth biggest bank in France.
It claims that, free from the ball and chain of the rest of Crédit Mutuel, it will be able to take full advantage of its leadership in digital technologies to become a European leader.
