Credit Agricole posted its worst loss since the bank went public in 2001, following a series of accounting writedowns, including taxes on the sale of its Greek unit.

The French bank posted a €6.5bn (£5.62bn/$8.7bn) full-year loss, while net income for the group in the fourth quarter missed analyst expectations and fell to €3.9bn, according to an earnings statement published on its website.

The bank is also scrapping its dividend and confirmed that it is targeting a Basel III common equity Tier 1 target of more than 10 percent for the end of 2013.

It will be making a number of job cuts to buoy up its balance sheet, roughly doubling the scale of an existing voluntary layoff plan to 720 employees at its Italian unit.

Consensus estimates had predicted the group would post net income of -€3.69bn for the fourth quarter, but the net loss widened 30 percent from a year earlier.

At the beginning of this month, France's third-largest bank revealed that it had lopped billions in value from its books, after paying the price for a series of failed acquisitions before the global financial crisis.

The bank reduced the so-called 'goodwill' value of three business units by around €2bn and booked a total writedown for the three months ending in December of €2.67bn initially.

Goodwill is an accounting convention that represents the amount paid for an acquisition over and above its market value. The group tried to reassure investors that the health of its balance sheet would not be impacted but said it earnings will take a hit when published on 20 February.

However, bank executives said to the media on Tuesday that an unexpected decision by French tax authorities to refuse a tax deduction sought by Credit Agricole for the sale of Emporiki Bank triggered a major multi-million-euro tax hit.

"The fourth quarter of 2012 saw a continuation of the efforts carried out throughout the year, aimed at reducing the risks facing the Group and rapidly adjusting to the new environment. The impact of the decisions made in this respect is reflected in the results for the quarter," says Jean-Paul Chifflet, Chief Executive Officer of Crédit Agricole in the bank's earnings statement.

"2012 was a year of transformation and refocusing. We are turning a page and will develop a new medium-term plan this year. It will show that we are moving forward on solid foundations," he adds.