2 French Banks Said to Be Near Merger

French bank Credit Agricole and rival Credit Lyonnais are on the verge of a $20-billion merger that would form one of the biggest financial institutions in Europe, according to published reports.

The announcement, which could come as soon as today, would follow a weekend of talks on creating a bank with more than $32.4 billion in market value and a 28% share of France’s market for retail banking. Such a move would end a four-week tussle between Credit Agricole and rival suitor BNP Paribas for control of Credit Lyonnais.

Credit Agricole is set to offer about $57 a share in cash and stock for Credit Lyonnais, the fourth-largest listed bank in France, according to a Dow Jones Newswires report.

Credit Agricole Chairman Rene Carron and Chief Executive Jean Laurent spent much of the weekend in meetings in a bid to persuade the farm bank’s powerful regional executives to support the bid.

Credit Agricole’s board of directors, which met with regional executives, Sunday gave a green light to the plan, Dow Jones Newswires reported. The report said Credit Lyonnais directors also met Sunday to discuss the move.

Several attempts by Associated Press to reach a Credit Lyonnais spokesman were not successful.

Marie-Aude Dubanchet, a spokeswoman for Credit Agricole, declined to comment about the merger plan to AP, but she acknowledged that the company’s board had met Sunday.

Last week, BNP Paribas said it wouldn’t stand in the way of a friendly merger between its two rivals as long as it was acceptable to Credit Lyonnais’ shareholders and its 40,000 workers. BNP Paribas has built up a 16.2% stake in Credit Lyonnais.

Credit Agricole has been Credit Lyonnais’ top shareholder for more than three years, and it is expected to propose a plan that would see large parts of their businesses merged. Credit Agricole currently owns 17.4% of Credit Lyonnais.

Credit Agricole has been in merger talks with Credit Lyonnais since Credit Lyonnais was privatized in mid-1999, but the two sides failed to come to an agreement -- most recently falling out over who would take top management slots in a newly merged bank.

Relations have thawed in recent weeks as Credit Lyonnais was faced with a choice between negotiating a merger deal with Credit Agricole or joining BNP Paribas.