(AOF) – BNP Paribas has signed an agreement to acquire Kantox, a fintech specializing in automated management of foreign exchange risk. Kantox’s technology centralizes the management of all corporate foreign exchange transactions with a simple, API-based solution that has proven to be a one-stop solution in international B2B payments. “The technology developed by Kantox provides an unparalleled level of automation and sophistication for corporate currency hedging strategies,” the bank points out.
Thanks to its integrated model, BNP Paribas is well positioned to accelerate the development of Kantox and support the deployment of its offer to a wide range of corporate clients on a global scale.
The acquisition of Kantox will benefit from the support of the Global Markets activity of the BNP Paribas CIB division and the Enterprise business centers of the Commercial, Personal Banking & Services (CPBS) division. The two divisions will contribute to the deployment of Kantox technology with their large corporate, SME and mid-cap customers, by capitalizing on their knowledge of companies as well as on the Group’s local presence.
This acquisition is part of BNP Paribas’ Growth Technology Sustainability 2025 strategic plan and illustrates the Group’s desire to accelerate the deployment of technological innovations, to continue to improve the customer experience and offer solutions at the best market standard. .
“Corporate treasurers today operate in a hectic market environment and cutting-edge technologies can help them alleviate some of the challenges they face, including automating manual tasks allowing them to stay focused on their core business. profession,” said Olivier Osty, Head of BNP Paribas CIB Global Markets.
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Key points
– Bank born in 1822, reinforced in 1999 by the merger with Paribas, 1st in France and 7th worldwide;
– Net banking income of €46.26 billion generated by international financial services (34%), banking networks (35%) and investment banking (31%);
– More than 80% commitments in “rich” countries: France for 32%, Belgium & Luxembourg for 16%, Italy for 9%, other European countries for 19%, North America for 13%, Asia-Pacific for 6 %;
– Business model based on diversification in locations and businesses, synergies and cooperation between businesses, on operational innovation and for customers;
– Capital held by the Belgian State (7.7%), the Grand Duchy of Luxembourg (1%) and the employees (4.4%), with a board of directors of 13 members chaired by Jean Lamierre, Jean- Laurent Bonnafé being Managing Director;
– Solid financial position – CET 1 ratio of 12.4%, return on equity of 13.4% and liquidities of €468 billion.
Challenges
– GTS 2025 plan for growth, technology and sustainability aimed at:
– 11% return on equity, annual growth of 3.5% in NBI, self-financing of transformation and investments and distribution rate of 60%, including at least 50% in dividends:
-Highest rated innovation strategy in the sector and focused on digitalization:
– internally: support for intrapreneurs (Lux Future Lab, People’sLab4Good, Bivwak),
– in the offer to customers: 4.4 million “digital” customers, leader in France in digital functionalities, world-leading platforms in government bonds, forex or swaps and in the top five European neo- banks with Hello Bank!,
– partnerships: global Plug and Pay platform for accelerating start-ups;
– Environmental strategy aiming to become the world leader in sustainable finance (2nd worldwide in green bonds and 1st in Europe, 1st in Europe for financing renewable energy projects):
– objective of carbon neutrality in 2050,
– by 2025, €350 billion mobilized in sustainable loans and bond issues and €300 billion in sustainable investments;
– alignment of the loan portfolio with the trajectory of the Paris agreement (end of coal financing in 2030 in Europe and deployment of the Pacta methodology),
– advances in green microfinance,
– funding of €4 billion for biodiversity;
– Towards joint ventures with the financing subsidiary of Stellantis, operating in Germany, Austria and the United Kingdom.
Challenges
– Change in net book assets, €78.7, to be compared with the stock market price;
– Continued control of management fees and the cost of risk;
– Russia-Ukraine war: very marginal impact –depreciation on the Ukrainian subsidiary- and interruption of services to Russian customers;
– Use of funds from the sale of the US subsidiary BoW – €14.4 billion split between share buyback program, investments in technologies and targeted acquisitions;
– After a dynamic 1st quarter, confirmation of 2025 objectives;
– Share buyback programs and 2021 dividend of €3.67, i.e. 50% of the profit.
The negative effects of rising interest rates
The rise in interest rates normally causes an increase in bank income through the loans granted. In Europe, according to a survey conducted by S&P among 85 banking establishments, the sector expects an average increase of 18% in its net interest income. However, this new inflationary context also has undesirable effects, in particular an increase in refinancing costs. It is also accompanied by the fear of a new recession, which would then affect all the bank’s businesses, ranging from loans to asset management, whose income is correlated to market valuations. Reassuring element: the banks of the euro zone are sufficiently solid to face a deterioration of their environment.