Banco BPM to review Credit Agricole merger proposal

Banco BPM said its board will discuss a proposal from Credit Agricole regarding a combination with the French bank’s Italian operations at a meeting scheduled for Thursday.

The Milan-based lender said Monday it received a letter from Credit Agricole on Sunday proposing talks for a potential merger between BPM and Credit Agricole Italia.

The proposal includes the French group’s controlling stakes in its Italian life and nonlife insurance businesses.

Credit Agricole disclosed Monday it wants to combine its Italian banking and insurance operations into BPM.

The French bank would pay a €1 billion ($1.12 billion) dividend to BPM shareholders in exchange for a stake of about 45% in the combined group. Credit Agricole currently holds 29.6% of BPM.

BPM’s board will receive an initial briefing on the proposal at Thursday’s meeting.