Following the release of its financial results, BNP Paribas’s profit fell by a third in the first quarter (down to € 1.28 billion, while revenue fell 2.3% to € 10.9 billion) as the coronavirus crisis hit stock trading and forced the biggest the Bank in the euro area to allocate more than half a billion euros to lending.
In a statement, CEO Jean-Laurent Bonnafe “Good resilience of returns and results despite this shock demonstrates the robustness of the group’s diversified and integrated model.” He added: “Extreme and extreme volatility has led to distortions in hedging, mainly due to European authorities’ dividends in 2019. ”
Decisions to limit dividends had a one-off negative impact on share trading income of EUR 184 million. The bank also stated that it would accelerate the reduction of operating costs and warned that its net profit by 2020 could be about 15% to 20% lower than in 2019. It stated that earnings from trading in shares were European markets at the end of March “and a year ago reached sales of -87 million euros compared to 488 million euros.
BNP’s trading results did not outperform European rivals such as Barclays and UBS, which had twice the buffer for trading.
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