BNP Paribas equities trading revenues double as push continues

BNP Paribas’ ongoing push into equities trading led to a record quarter for the unit, but its investment bank revenues still shrank by 10% as fixed income dropped sharply.

The French bank made €757m in its equities and prime services unit during the second quarter, ahead of analyst expectations of  €548m and more than double the comparable period in 2020, when French banks were rocked by a slump in equity derivatives revenues.

The performance helped push overall profits at the bank up by 27% to €2.9bn.

BNP Paribas’ equities unit reported a record second quarter, and helped offset a sharp decline of 43% in fixed income trading revenues to €1.1bn. Overall, its corporate and institutional unit fell by 9.9% to €3.7bn as the bank pointed to more normalised capital markets activity following a spike in the early days of the Covid-19 pandemic last year as companies rushed to shore up their balance sheets.

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BNP Paribas has traditionally been a bigger fixed income player, but has ambitions to grab a bigger share of the equities trading market as European rivals including Deutsche Bank, Commerzbank and HSBC have pulled back. The bank wants to become a top three equities franchise in Europe, executives told the Financial Times in March.

Last year, BNP Paribas, Societe Generale and other French banks unveiled sharp loses after Covid-19 market volatility hit complex structured products within their equity derivatives units.

But BNP Paribas has made some major moves to expand its equities unit. It is transferring clients from Deutsche’s prime services unit after the French bank agreed to acquire it in 2019. The move could mean up to 800 staff transfer across.

Meanwhile, it completed the acquisition of the remaining 50% stake in Exane, the investment firm it already part owned, in July. The move aims to bolster its cash and equity derivatives trading unit.

To contact the author of this story with feedback or news, email Paul Clarke

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