This content is not available in your region

BNP Paribas quarterly profit falls less than expected

Access to the comments Comments
BNP Paribas quarterly profit falls less than expected
The BNP Paribas logo is seen outside a bank office in Bordeaux, France, October 29, 2019. REUTERS/Regis Duvignau   -   Copyright  REGIS DUVIGNAU(Reuters)
Text size Aa Aa

PARIS (Reuters) – BNP Paribas SA <BNPP.PA> reported an 8.8% fall in quarterly profit on Thursday, a smaller decline than analysts had expected, as economic growth in France helped expand its loan book and it earned more from its investment banking business.

The company’s results follow that of Europe’s biggest banks, such as Barclays <BARC.L> and HSBC <HSBA.L>, which warned it may be hard or impossible to meet their profit targets, given the worsening global economic outlook.

BNP Paribas had already reduced 2020 profitability targets and announced new cost cuts at its investment banking unit at the beginning of this year.

Indications by the European Central Bank (ECB) that negative interest rates are here to stay and intense competition in the retail banking market are also weighing on banks’ ability to make profits.

BNP Paribas said on Thursday new monetary policy measures announced at the end of the quarter would come into full effect only in 2020.

The company’s net income for the third quarter was 1.94 billion euros ($2.16 billion), compared with 2.12 billion euros a year earlier, when its topline was boosted by gains on a stake sale.

The quarterly net income topped an average forecast of 1.80 billion euros in a Reuters survey of four analysts.

“The business of BNP Paribas was up this quarter in all the operating divisions in a context where economic growth slowed down but still remained positive in Europe, in particular in France,” the bank said.

Pre-tax profit at its corporate and institutional bank rose by 13.5% in the third quarter, helped in particular by a sharp rise in credit and primary issues and a rebound in forex trading.

The company added, however, that provisions at the unit rose by 130 million euros compared to a year earlier, which reflected the “impact of a significant file”.

Pre-tax income at the company’s French retail unit rose by 5.2%, as it continued to cut costs and grew loans by 5.9%.

($1 = 0.8966 euros)

(Reporting by Maya Nikolaeva, Editing by Sarah White, GV De Clercq and Shounak Dasgupta)

euronews provides breaking news articles from reuters as a service to its readers, but does not edit the articles it publishes. Articles appear on for a limited time.