The banking giant BNP Paribas achieved in the second quarter a record net profit of 3.18 billion euros, an increase of 9.1% over one year, with an increase in income in all businesses.
Net banking income (NBI), equivalent to turnover for the sector, for its part increased by 8.5% over one year, to 12.78 billion euros. In the first half, its profit already amounted to 5.29 billion euros, for a NBI of 26 billion.
After a historic year in 2021, with a net profit of 9.5 billion euros, the leading European bank is therefore continuing its momentum and could, barring a turnaround, exceed this record. As in previous quarters, the bank attributed the performance to strong revenue growth supported by all divisions.
In detail, BNP Paribas’ activity dedicated to large companies and institutions increased by 10.6% compared to the second quarter of 2021, reaching around 4.1 billion euros in turnover. The Commercial, personal banking and services activity, which includes the activity of commercial banks and specialized businesses, such as car leasing with Arval or payment with Nickel and Floa, grew by 11.1% over one year, nearly of 7.18 billion euros in revenue.
Finally, activity in the investment and protection services businesses, which are insurance, collection and asset management, grew by 2.2% to 1.73 billion, a slower increase than the other divisions, due in particular to the poor performance of the financial markets in the second quarter.
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Positive jaws effect
BNP Paribas’ performance this quarter confirms a solid trajectory accompanied by revenue growth, a positive jaws effect and prudent risk management, the statement said. The jaws effect reflects the difference in change between revenues and costs, and is therefore positive when the former increase more rapidly than the latter, or even when the latter fall.
Finally, the cost of risk, i.e. the sums provisioned to deal with any unpaid loans on loans granted, was down very slightly to 789 million euros in the second quarter (-3% over one year) and notably includes an allocation of 511 million euros to take into account the expected losses in connection with taking into account the indirect effects of the invasion of Ukraine, the rise in inflation and interest rates.
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