PARIS (Reuters) – France’s BNP Paribas reported better-than-expected earnings on Wednesday. This came after a surge in equities trading boosted BNP Paribas trading revenues. The increase in investment banking revenue offset a significant drop in net interest income from its French retail business.
The euro zone’s biggest bank by market value said second-quarter net income grew by 21% on a reported basis from a year earlier to a record 3.4 billion euros ($3.69 billion), exceeding the 2.91 billion-euro average of 16 analyst estimates compiled by the group. #BNPParibasTradingRevenues
Group revenues rose about 8% to 12.3 billion euros, beating the 11.9 billion-euro average estimate. The cost of risk, or money set aside for failing loans, was a lower-than-expected 752 million euros.
BNP’s results were aided by a 58% jump in sales from equity and prime brokerage services, which involve facilitating the buying, selling and lending of shares and providing other services to clients such as hedge funds.
BNP said its overall second-quarter investment bank revenues climbed 12% from a year ago to 4.48 billion euros. #BNPParibasTradingRevenues
The results will be a boost for CEO Jean-Laurent Bonnafe, who has made BNP’s investment banking division a key driver of growth plans but has struggled to lift the bank’s shares in recent months.
Moreover, the bank’s positive results highlight the crucial role of trading revenues in its overall financial health. As BNP Paribas continues to navigate market fluctuations, the growth in BNP Paribas trading revenues will likely play a vital role in its strategy. Consequently, this surge helps mitigate challenges faced in other business areas.