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Business

BNP Paribas profits rise amid bank sector hopes

Text by NEWS WIRES

Latest update : 2009-08-04

French bank BNP Paribas has posted a 6.6-percent rise in second-quarter net profit to 1.6 billion euros, confirming a pick-up in the banking sector amid signs that the worst of the economic crisis may be over.

AFP - French bank BNP Paribas posted a 6.6-percent rise in second-quarter net profit on Tuesday -- the latest lender to report a pick-up as signs mount that the worst of the economic crisis may be over.
  
"In an environment characterised by a continued deterioration in the economy and a gradual normalisation of the markets, BNP Paribas Group again had a solid performance," the bank said in its earnings statement.
  
BNP Paribas chief executive Baudouin Prot said the bank was now "well positioned to take on the challenges of the current economic environment."
  
Prot told reporters after the results were announced that the bank would "continue to have a good activity" in the coming months.
  
Emerging markets bank Standard Chartered posted record first-half profits on Tuesday and leading British banks Barclays and HSBC raised hopes for the crisis-hit financial strong sector when they posted strong profits on Monday.
  
Bank of America, Citigroup, JPMorgan Chase and Goldman Sachs beat market expectations with strong results last month although most of the gains from the institutional side of operations with consumer segments still struggling.
  
BNP Paribas also said its profit gain was led by the finance and investment division, which had pre-tax earnings of 1.145 billion euros (1.648 billion dollars), more than double the figure for the same period last year.
  
But pre-tax income at its French retail banking division was down 17.9 percent and the cost of risk, mainly provisions for bad loans, also rose to 2.0 billion euros from 1.8 billion euros in the first quarter.
  
Its Italian subsidiary BNP saw a 22.5-percent fall in pre-tax income.
  
The bank also said its net profit over the first half of the year was down 9.3 percent from the figure for the first half of 2008.
  
The results nudged BNP Paribas shares up 0.04 percent to 52.55 euros by 1100 GMT on the Paris stock market, which was down 0.61 percent.
  
Other French bank shares were mixed, with Societe Generale falling 1.69 percent at 45.32 euros and Credit Agricole rose 2.08 percent at 10.82 euros.
  
BNP Paribas noted in particular the positive contribution to its results of Fortis Bank, Belgium's biggest lender. BNP Paribas completed the takeover of Fortis in May after an eight-month wrangle as shareholders delayed the deal.
  
The Belgian state nationalised the Belgian banking arm of financial services group Fortis at the peak of the financial crisis last October and later sold it to BNP. BNP Paribas Fortis boosted group earnings by 261 million euros.
  
BNP Paribas has held up well during the crisis without state aid, reporting a net profit of 1.5 billion euros in the first quarter of the year as other lenders struggled with the effects of the worst economic crisis in decades.
  
First-quarter profits were still down 21 percent from a year earlier.
  
Prot on Tuesday said the bank could make "small acquisitions" but said it would focus on integrating BNP Paribas Fortis and building up market share.

Date created : 2009-08-04

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