GO
Loading...

Enter multiple symbols separated by commas

BNP Paribas Profit Up; Concerns Over French Retail

French bank BNP Paribas beat forecasts with a 28.8% rise in fourth-quarter net profit on Thursday, but some analysts expressed concerns over the performance of its French retail banking division.

BNP Paribas, the euro zone's second-biggest bank by market capitalization, said net profit rose to 1.719 billion euros ($2.2 billion), boosted by last year's takeover of Italian bank BNL.

Twenty-one analysts polled by Reuters gave an average net profit forecast of 1.563 billion euros.

BNP Paribas' results come a day after rival French bank Societe Generale posted a 6% rise in its fourth-quarter net profit.

Gross operating profit rose 22.8%to 2.398 billion euros, below the average forecast as costs came in higher than expected at 4.654 billion euros. This rise in costs was mainly related to the takeover of BNL.

However, some analysts focused on a slowdown in momentum at its French retail banking arm. Similar to SocGen, the bank's domestic retail division has been hurt by margin pressure.

As short-term rates have risen, long-term rates have remained low, flattening out the differences between the two -- as reflected in the yield curve. A flattened yield curve squeezes banks' net interest margin, the difference between what they pay to borrow money and what they charge to lend it.

"Overall, retail's contribution to the group's earnings is disappointing," ING analysts said in a note.

BNP Paribas increased its dividend by 19%to 3.1 euros, in line with forecasts.

Its stock has risen around 5%since the start of 2007, in line with a similar increase in the DJ Stoxx European bank sector.

Contact U.S. News

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    Please choose a subscription

    Please enter a valid email address
    To learn more about how we use your information,
    please read our Privacy Policy.

Don't Miss

  • Lottery ticket

    A thief who broke into the car of a Seattle couple left behind a million-dollar lottery ticket, NBC News reports.

  • The Lamborghini SpA Urus SUV.

    There's no shortage of luxury vehicle choices, but increasingly the wealthy are opting for high-end SUVs instead of traditional models.

  • Mike Trout #27 of the Los Angeles Angels takes a picture with fans before a game with Boston Red Sox at Fenway Park on May 23, 2015 in Boston, Massachusetts.

    MLB is using digital media initiatives like Snapchat and Web video to connect with younger viewers. Is it enough?

U.S. Video

  • Cramer: Here's the no. 1 play in cybersecurity

    Guarding Your Portfolio? "Mad Money" host Jim Cramer's got the number one pick for protection services in today's digital world.

  • Underestimate Cisco at own peril: Cramer

    Mad Money's Jim Cramer takes a look at the cybersecurity space to see if it could also protect your money.

  • Fly with LUV?

    While remaining profitable, Gary Kelly, Southwest Airlines chairman and CEO, tells Mad Money's Jim Cramer the company continues to focus on being a great airline and offering great customer service.