Thursday May 14, 07:10 PM
Natixis shares plunge after massive loss
PARIS (AFP) - Shares in French investment bank Natixis (Paris: FR0000120685 - news) plunged Thursday after it reported a massive first quarter loss of 1.8 billion euros (2.5 billion dollars) and another capital increase.
The bank, badly hit by the global financial crisis, said it would get a capital injection of 3.5 billion euros from its two biggest shareholders.
This would be the third in less than a year from the bank's two main shareholders -- French lenders Caisse d'Epargne and Banque Populaire -- with the total coming to more than nine billion euros.
Natixis shares closed the day down 13.58 percent at 1.42 euros, having lost 18 percent at one stage following the announcement late Wednesday. When the company listed in 2006, its shares were worth 19.55 euros.
Natixis' day-to-day operations were profitable but it is handicapped by a 33 billion euros portfolio of illiquid assets which have been ring-fenced but were still losing value, thus weighing on results.
One analyst said the bank seemed to be "living from day to day... we will see if it can continue like that at the end of the second quarter."
Alain Tchibozo of ING Financial Markets said he could no longer rule out the possibility that the bank would fail, even after the latest capital injection.
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