February 5, 2018 / 7:02 PM / 12 days ago

France tells Credit Mutuel Arkea to detail its plans to split from parent

PARIS, Feb 5 (Reuters) - The French Treasury and central bank urged Credit Mutuel Arkea on Monday to present details about the impact that would result from its potential split from cooperative bank Credit Mutuel.

The board of Credit Mutuel Arkea, part of France’s fifth-biggest lender, gave its management approval this month to do whatever was necessary to break away from its parent group of cooperative banks.

Members of Credit Mutuel Arkea’s local banks will vote in the first half of 2018 on whether to proceed.

French Treasury chief Odile Renaud-Basso and central bank Governor Francois Villeroy de Galhau told Credit Mutuel Arkea’s President Jean-Pierre Denis in a letter that a detailed scenario about the potential split should be presented to local banks.

They said the government did not want to change existing legislation for cooperative banks to make the split happen.

Credit Mutuel Arkea, made up of regional banks in western and central France and now seeking financial independence from its parent, has challenged the European Central Bank’s power to oversee the whole network of lenders as a single entity.

Credit Mutuel Arkea said in a statement that it was in discussions with the ECB and the French authorities about its plan.

Reporting by Maya Nikolaeva; Editing by Edmund Blair

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