Economic recovery boosts BNP Paribas

PARIS (AFP) – French bank BNP Paribas said on Friday that the improving economy and cost savings help boost its bottom line in the second quarter.

In the period of April through June the bank generated a net profit of EUR2.9 billion, an increase of 27 per cent from the same period last year when much of France’s economy was shut under pandemic restrictions.

However, it was also 18 per cent higher than the second quarter of 2019.

The bottom line was boosted by exceptional items such as the sale of certain assets, but even excluding these items, net profit was still up 16.5 per cent from the second quarter last year and 4.9 per cent from 2019.

“Business activity moved solidly back on track this quarter, as the public health situation improved, albeit with differentiated momentum from one region, one sector, and one business line to another,” the bank said in a statement. The bank’s revenues edged 0.9 per cent higher from the same period last year to EUR11.8 billion. That was up 4.9 per cent from 2019.

A BNP Paribas sign at the entrance of the bank in France. PHOTO: AFP

Cost-cutting also helped the bank improve its results. Costs were down by 2.3 per cent from the same period last year, and down 3.5 per cent from 2019.

Like other banks, BNP Paribas was also able to drastically reduce the amount of money it sets aside to cover bad loans. Banks had stepped up provisions last year as they feared the economic disruptions from the COVID-19 pandemic would push many businesses into financial distress or bankruptcy.

BNP Paribas said its risk costs fell by 44 per cent from the second quarter last year, to EUR813 million.

One of Europe’s leading banks, BNP Paribas operates in 68 countries and employs more than 193,000 people.