Credit Agricole's 2028 Strategic Plan: Strategic M&A as a Catalyst for European Banking Consolidation and Outperformance

In November 2025, Crédit Agricole S.A. unveiled its ambitious ACT 2028 strategic plan, positioning itself as a "conquering bank" determined to dominate Europe's evolving financial landscape. The plan outlines a bold vision: 60 million clients by 2028, nearly 60% of revenue generated outside France, and a return on tangible equity (ROTE) exceeding 14%. Central to this strategy is a renewed focus on strategic mergers and acquisitions (M&A), which the bank views as a critical lever for consolidating market share, achieving cost synergies, and outperforming peers in a fragmented European banking sector.

European Banking M&A: A Surge in Consolidation

The European banking sector has witnessed a dramatic uptick in M&A activity in 2025, with deals totaling $27 billion announced year-to-date-nearly double the 2024 volume according to Oliver Wyman. This surge is driven by the need for scale, regulatory pressures, and the pursuit of cost efficiencies. As Oliver Wyman notes, domestic consolidation in markets like Italy, the UK, and the Nordic countries is particularly active, with banks targeting synergies from streamlined branch networks, shared IT infrastructure, and reduced overhead according to Oliver Wyman. For Crédit Agricole, this environment presents a golden opportunity to accelerate its expansion while leveraging its financial strength- projected net profits of over €8.5 billion by 2028-to fund strategic acquisitions.

A key example is the bank's growing stake in Banco BPM, Italy's third-largest lender. Crédit Agricole has increased its ownership to just above 20%, with ambitions to raise it to 29.9% according to Reuters. CEO Olivier Gavalda has framed the potential merger as a "strategic opportunity" to solidify the bank's position in Italy, its largest market outside France according to Reuters. Meanwhile, the collapse of Unicredit's bid for Banco BPM has cleared the path for Crédit Agricole to advance its integration plans without significant competition according to Reuters.

Strategic M&A: A Blueprint for Outperformance

Crédit Agricole's M&A strategy is not merely about scale but about strategic alignment with high-growth sectors. The bank is prioritizing digital transformation, asset management, and cross-border expansion to drive long-term value. For instance, its launch of Crédit Agricole Deutschland aims to double its German client base to 2 million by 2028 according to Crédit Agricole, leveraging a digital-first model to reduce costs and enhance customer engagement. Similarly, its partnership with Amundi to expand savings platforms in Asia underscores its intent to capitalize on global wealth management trends according to Crédit Agricole.

Financial metrics reinforce the effectiveness of this approach. As of August 2025, Crédit Agricole's Return on Equity (ROE) stood at 9.51%, a sharp increase from the 1.80% average over the previous four quarters according to WiseSheets. This improvement aligns with broader European trends: the European Banking Authority (EBA) reported a sector-wide ROE of 10.7% in Q2 2025, driven by M&A-related cost synergies. By consolidating operations and optimizing capital allocation, Crédit Agricole is well-positioned to exceed its 14% ROTE target, outperforming peers reliant on stagnant net interest margins.

Navigating Challenges and Securing Stakeholder Buy-In

Despite its momentum, Crédit Agricole's M&A ambitions face hurdles. Cross-border deals, which account for 30% of European banking M&A value since 2020 according to Oliver Wyman, require navigating political sensitivities and cultural integration challenges. For example, the bank's expansion into Germany must contend with a highly regulated market and entrenched local competitors. To mitigate risks, Crédit Agricole is adopting a "precision M&A" approach, as outlined in McKinsey's 2025 Global Banking Annual Review-focusing on targeted acquisitions that enhance strategic capabilities rather than indiscriminate scale according to McKinsey.

Stakeholder engagement is equally critical. The bank has emphasized transparency in its communication with regulators, shareholders, and employees, ensuring alignment with its long-term vision. For instance, its commitment to a 55% cost-to-income ratio by 2028 according to Crédit Agricole signals disciplined cost management, a key concern for investors evaluating M&A-driven growth.

Conclusion: A Model for the Future of European Banking

Crédit Agricole's ACT 2028 plan exemplifies how strategic M&A can catalyze consolidation and outperformance in a fragmented sector. By targeting high-potential markets, leveraging digital innovation, and prioritizing cost synergies, the bank is not only reshaping its own trajectory but also setting a benchmark for peers. As European banks continue to grapple with regulatory demands and margin pressures, Crédit Agricole's disciplined approach to M&A offers a compelling roadmap for sustainable growth.