Equity analysts are completely divided over the outlook for large French banks. At one end of the scale they take the decidedly negative view that French banks are likely to need more capital and that earnings will be weaker than forecast. There are concerns over exposures to commodities and emerging markets, and major structural changes cannot be ruled out, says one analyst.
At the other end of the scale there is a more positive view that argues that capital concerns have been exaggerated and that earnings will surprise on the upside. This school of thought sees the diversified franchises of BNP Paribas, Société Générale and Crédit Agricole SA as strengths and takes a positive line on the benefits of the universal banking model.
