(Boursier.com) — BNP Paribas drops 3.4% to 63.5 euros after the publication of its 2021 accounts and the presentation of its new strategic plan for 2025. If the bank unveiled net profit above market expectations in the fourth quarter, certain figures somewhat disappointed analysts, particularly on the revenue side of market activities. Over the period, BNP recorded a net profit of 2.31 billion euros (+45%), helped by a sharp reduction in the cost of risk in a context of normalization of the credit markets after the health crisis, for a net banking income, of 11.2 billion euros (+3.7%). The “common equity Tier 1” ratio reached 12.9% at the end of December, up 10 basis points over one year.
As part of its new strategic plan, management is aiming for an average annual growth of more than 3.5% per year in its revenues over the period 2022-2025. The more moderate increase in costs should result in growth of more than 7% per year in net income to bring the ROTE to more than 11% while maintaining a CET1 ratio target of 12% by 2025, integrating the full effect of the finalization of Basel 3 (CRR3). The Group’s financial strength at the start of the plan as well as the growth in ROTE should make it possible to support the profitable and balanced growth of the Group’s businesses while increasing the payout rate to 60%, with a minimum cash payout rate of 50 %.
Citi (‘buy’) believes that this plan “leaves many questions open”, particularly regarding return on capital, growth opportunities and profitability.
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