Credit Agricole Predicts Private Equity Assets To Double In 4 Years

Feb 3 2015 | 8:01am ET

By Sarmad Khan and Arif Sharif (Bloomberg) -- Credit Agricole SA, France’s third-biggest bank, expects its private equity investments to more than double in the next three to four years.

“Private markets -- including private equity, but also real estate and private debt -- are starting to be a very important asset class,” Olivier Carcy, global head of private equity at Credit Agricole’s Swiss unit, said in an interview in Dubai on Tuesday. Some wealthy clients now prefer these types of investments to “capture real economic growth,” and to avoid the volatility of stock markets, he said.

About 75 percent of Credit Agricole’s private equity allocations are in third-party funds and the rest in direct investments, Carcy said. The lender expects to invest about $400 million to $500 million in private equity deals this year and return about $300 million to clients as it sells out of earlier transactions, he said.

Deal activity in Europe this year should increase as credit is cheap and strains on the region’s economy mean that “the only way to grow is to buy other companies,” Carcy said.

Credit Agricole expects to sell stakes in about 40 to 50 companies in Europe this year and a further 20 to 25 companies in the U.S., Carcy said. The lender’s private equity investments returned 11 percent a year on average between 2001 and 2014, including about 25 percent last year, he said.

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