Credit Foncier to sell 1 bln eur in mortgage securities-CEO

PARIS, Oct 11 (Reuters) - French mortgage lender Credit Foncier is to kicks off a securitisation programme that will see it sell around 1 billion euros ($1.29 billion) in mortgage debt in the coming weeks, the bank's chief told Reuters on Thursday.

The move comes as Europe's banks seek to cut their balance sheets in the face of tougher regulation and a sputtering economy. It could be a sign of confidence for a French market mortgage-backed securities market which has been slow to recover from the 2008 financial crisis.

"We will very soon launch a first securitisation programme of mortgage bonds...We are working on an initial size of around 1 billion euros," Credit Foncier CEO Bruno Deletre said in an interview, adding insurers and other funds had shown interest.

Credit Foncier, which is owned by cooperative banking group BPCE and which usually funds itself via the covered-bond market, plans to securitise around 2 billion euros' worth of bonds per year by 2016, said Deletre. The bank will retain between 5 percent to 20 percent of each loan depending on the type. ($1 = 0.7726 euros)

(Reporting by Lionel Laurent and Matthias Blamont)

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