By Mathieu Rosemain
PARIS -France’s BNP Paribas reported first-quarter earnings in line with expectations thanks to rising sales at its investment bank, and stuck with its profit forecasts despite a deteriorating economic outlook prompted by a global trade war.
The eurozone’s biggest bank by assets said on Thursday group net income over the first three months of the year fell by 4.9% from the same period a year earlier to 2.95 billion euros ($3.34 billion), against the 2.94 billion-euro consensus forecast.
BNP said that last year’s re-inclusion of its Ukrainian operation into its accounts fully explained the year-on-year decline.
The French lender’s three main divisions otherwise all posted an increase in pre-tax income, led by its corporate and institutional banking unit, which saw sales advance 12.5% to a record as turbulent financial markets spurred more client activity.
Group revenues climbed 3.8% to nearly 13 billion euros, also in line with analyst expectations.
BNP is the first of the big European banks to report this quarter and after U.S. President Donald Trump unleashed a global trade war at the start of April all eyes are on the outlook and how banks expect to navigate an anticipated slowdown in economic growth that could hit loan demand.
European bank shares have tumbled in April, although they have partly rebounded this week as Trump’s administration signals a willingness to de-escalate the trade war with China.
Chief executive Jean-Laurent Bonnafe sought to paint a positive picture, saying BNP was well-positioned to benefit from any increased corporate activity created by Germany and the European Union’s big fiscal spending plans, as the region tries to rebuild its militaries and revive economic growth.
In written comments, Bonnafe did not address the economic outlook and Trump’s tariffs.
He confirmed BNP’s 2024-2026 targets published in February, including an average annual growth in net income of more than 7% and an annual average growth in sales of more than 5%.
BNP’s first-quarter numbers also showed sluggish performance at its retail business, especially at Italian unit BNL. Its car-leasing division Arval suffered an 11.8% decline in sales as used cars prices continued to fall.
($1 = 0.8826 euros)
(Reporting by Mathieu Rosemain; Additional reporting by Bertrand de Meyer;Editing by Tommy Reggiori Wilkes)
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