BNP Paribas, the euro zone’s biggest bank, saw profit more than double in the first quarter from a year ago, bolstered by the sale of its U.S. retail division while revenue beat estimates.
This allowed the French bank to beef up its capital and liquidity buffers, at a time when European lenders strive to restore confidence in a sector battered by turmoil.
Revenue of just over 12 billion euros ($13.20 billion) in the period exceeded the company’s compiled consensus of 11.7 billion as net interest income ticked higher in the usually difficult French retail market, the bank said on Wednesday.
In securities trading, revenue edged down 1.8% but still performed better than some peers including Deutsche Bank, which saw fixed-income trading decline by 17% in the first quarter.
At U.S. bank Goldman Sachs, first-quarter sales from fixed income, currency and commodities (FICC) trading, usually a bright spot, plunged 17% to $3.93 billion, while equity trading revenue sank 7% to $3.02 billion.
BNP’s FICC trading over the period was up 9%.
The sale of Bank of the West, which was expected and closed in February, yielded about 2.95 billion euros ($3.25 billion) in capital gains, the French lender said, helping BNP Paribas shore up its CET 1 ratio — a key measure of financial strength — to 13.6%, up from 12.3% in the previous quarter.
The first quarter net income, group share amounted to 4.44 billion euros, in line with expectations, and up from 1.84 billion a year earlier.
The group’s liquidity ratio was also up by 10 percentage points over the same period, to 139%, while the group’s cost of risk — money put aside for failing loans — stood lower than expected at 642 millions euros.
BNP’s first-quarter sales were up by 1.4% from a year earlier to 12.03 billion euros, driven by its investment bank and its commercial and retail branch.
The group’s global markets division, which bolstered BNP’s results in 2022, saw its sales edge down by 1.8%, in spite of a continued growth in FICC trading (fixed income, commodities, currencies).
Source: CNBC
