PARIS: BNP Paribas notched up better than expected results in the first quarter helped by the French group’s investment banking division nearly doubling its pre-tax profits.
Increased income from buying and selling bonds and equities in particular fuelled an 88 per cent rise in profits to €1.3bn in the corporate and institutional banking divisions amid volatile markets and a pickup in corporate loan demand.
The European Central Bank’s bond-buying programme to stimulate the economy has been a boon for the markets, with rivals including Deutsche Bank, Goldman Sachs and Morgan Stanley also benefiting.
The stimulus package helped France’s largest listed bank by assets to report net profit up 18 per cent to €1.65bn in the three months through March, ahead of analysts’ estimates. The bank also pointed to an improving economic picture in the Eurozone.
“The gradual recovery in demand for loans in the Eurozone, good business growth in America and in Asia and the strong business of major clients in capital markets sustained revenue growth,” said Jean-Laurent Bonnafé, chief executive.
Total revenues were up 11.6 per cent to €11.07bn, helped by the acquisition last year of Poland’s Bank Gospodarki Zywnosciowej as well as the purchase of an additional stake in consumer finance business LaSer Group.
The group’s European retail banking business saw a 17 per cent rise in profits to €849m. Results were helped by BNL, the group’s Belgium unit, which reported a doubling of pre-tax profits to €100m. However, the French retail business reported a 3.4 per cent decline in profits to €424m,
BNP also announced that Thierry Laborde will take over from Francois Villeroy de Galhau in overseeing retail banking in France, Italy and Belgium. He will be leaving at the start of May to lead a mission for the French government on investment in France and Europe.
The move will lend weight to speculation that Mr de Galhau is a potential candidate to succeed Christian Noyer as head of the French central bank when he retires later this year.
