The leading French bank BNP Paribas once again broke its net profit record last year, for the third year in a row, boosted by the rise in interest rates, its financing and investment businesses and the sale of its subsidiary. American Bank of the West.
The group
“achieves a very good performance in 2023 which reflects the solidity of our diversified model”
, welcomed its general director Jean-Laurent Bonnafé on Thursday, quoted in a press release.
At nearly 11 billion euros, last year's net profit is 11.2% higher than the 2022 record, after recalculation incorporating changes in accounting and scope.
The year 2021 was already unprecedented.
Net banking income (NBI), equivalent to turnover for the sector, is almost stable over one year, at 45.87 billion euros.
The sale of Bank of the West, sold for $16.3 billion at the beginning of February, enabled the group to record a capital gain of nearly 3 billion euros.
The good performance of the corporate and investment bank - 5.7 billion euros in pre-tax profit last year, or +6.4% over one year - allows the bank to compensate for a last quarter in half -tint.
Disputes at the end of the year
If it was marked for the industry by the sudden collapse of several regional banks in the United States and the catastrophic takeover of Credit Suisse by UBS, the start of 2023 rather spared BNP Paribas.
It was also in the first quarter that the bank entered into its accounts the capital gain from the sale of its American subsidiary.
The end of the year was more stormy.
On the social level, the banking group failed to reach an agreement in October with the two main trade union organizations within the framework of obligatory annual negotiations (NAO), after a rare strike movement.
On the legal front, the subsidiary dedicated to consumer credit BNP Paribas Personal Finance was convicted at the end of November on appeal for deceptive commercial practices in the context of the Helvet Immo real estate loan affair.
BNP Paribas has also reflected this dispute on an accounting level, by providing 221 million euros in the fourth quarter, as well as 450 million euros for mortgage loans in Poland, also backed by the Swiss franc.
These two elements contribute to the halving of net profit over one year between October and December, to 1.07 billion euros.
Also read: “We will lower our rates this year,” promises the governor of the Banque de France
Share buyback
The corporate and investment bank (BFI) remained one of the driving forces of the BNP Paribas group in 2023.
Activity was particularly strong on the equity markets while the interest rate, foreign exchange and raw materials markets, very active in 2022, returned to more traditional levels.
The commercial banking division (France, Belgium, Italy, etc.), brought together with specialized businesses such as car leasing, with Arval, or payment, with Nickel and Floa,
“is growing”
, assures the group, despite the setbacks from Personal Finance.
BNP Paribas also remains on track to take over the customers of Orange Bank, which is closing its doors. Income from investment, insurance and savings businesses is experiencing mixed fortunes, asset management doing better than real estate development, for example.
The cost of risk, that is to say the sums provisioned to deal with possible unpaid debts on loans granted, dates back to the fourth quarter, at 972 million euros.
The bank finally intends to pay its shareholders a dividend up 18%, to 4.60 euros per share, or half of its
“distributable”
result , of 11.23 billion euros.
A new share buyback program of 1.05 billion euros has also been announced.