Credit Agricole is to cut 2,350 jobs, mostly at its investment banking division.
The French bank also said it will not pay a dividend to shareholders this year and will post a net loss because of 2.5 billion euros in write-downs from its investment banking operations.
It is slashing costs and pushing ahead with a back-to-basics strategy which has been sped up by the eurozone debt crisis.
Banking sources have said Credit Agricole may pull out of up to 20 of the 50 countries where it operates.
The job losses include 1,750 at Credit Agricole’s corporate and investment bank, which employs 13,000 people and 600 job at its factoring and consumer finance arms.
The bank is following in the footsteps of larger domestic rivals BNP Paribas and Societe Generale,
which have announced job cuts primarily in investment banking as they seek to cut debt and wean themselves off funding markets frozen by the economic slump.
More than six months of intense market turmoil sparked by the euro zone debt crisis is pummelling investment banks globally, denting their bond and stock trading income and sparking a wave of layoffs in Asia, the US and Europe.
Credit Agricole to cut jobs, warns on profit