BNP Gives Upbeat Guidance After Strong Trading Buoyed Bank in Tough Year

   By Pietro Lombardi 
 

BNP Paribas SA struck a positive tone on the outlook for 2021, after a strong trading performance helped the company weather a tough year during the coronavirus pandemic.

France's largest listed bank by assets Friday joined its European peers in reporting strong results from trading and investment-bank operations, while the pandemic took a toll on its other divisions, BNP said.

Fourth-quarter net profit fell 14% to 1.59 billion euros ($1.90 billion), beating expectations of EUR1.21 billion, according to a consensus provided by FactSet. Revenue declined 4.5% to EUR10.83 billion, it said.

For the full year, profits fell 13.5% to EUR7.07 billion, better than the bank expected. Revenue dropped 0.7%, it said.

The investment-bank division posted another strong quarter: Global markets revenue rose 12%, with fixed-income revenue up 22%

BNP, one of Europe's largest banks, said it expects higher revenue and lower provisions this year, while operating costs should remain roughly stable. This year, it plans to distribute 50% of net profit to shareholders.

For 2020, it will propose a dividend of EUR1.11 a share, the maximum allowed under current European Central Bank recommendation, the bank said. However, it wants to increase returns to shareholders for 2020 via buybacks or distribution from reserves after such limits are lifted.

BNP's common equity Tier 1 ratio--a key measure of capital strength--was 12.8% at the end of December, above the bank's 12% target. As such, BNP will review its shareholders remuneration policy in its 2025 strategic plan, it said.

Write to Pietro Lombardi at [e-mail]; @pietrolombard10

(END) Dow Jones Newswires

February 05, 2021 01:33 ET (06:33 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.