BNP Paribas' second-quarter profit surges 33% as trading business booms drive performance rebound
The second quarter financial report released on July 23 showed that thanks to the investment banking business benefiting from the transaction boom, net profit for the quarter reached 4.3 billion euros, a year-on-year increase of 33%, and revenue increased by 12% to 14.1 billion euros. Driven by strong performance in the Global Markets business unit Investment banking revenue increased by 13% year-on-year. Among them, equity and main service business revenue increased by 43% to 1.4 billion euros, which was the main driving force for the 18% growth in global market business revenue. The move comes after the Wall Street bank reported record quarterly profits earlier this month, as heightened market volatility and active trading in AI-related stocks bolstered its trading operations. The gains were more modest than those of U.S. peers, but the results are expected to boost investor confidence after European banks failed to capitalize on violent market swings in the first quarter of this year. Second-quarter market volatility — especially around semiconductor and hyperscale stocks benefiting from the AI boom — helped stock traders on both sides of the Atlantic post big profits. Revenue from BNP Paribas' global banking unit, which includes consulting and capital markets businesses, increased 4%, and the bank said its transaction pipeline was "promising." Revenue at BNP Paribas' wealth, insurance and asset management unit rose by more than a quarter, helped by the integration of AXA Investment Management, which it acquired last year for 5 billion euros. Commercial and retail banking business achieved revenue of 6.9 billion euros in the quarter, a year-on-year increase of 5%. French banks have lagged behind many European peers in benefiting from higher interest rates in recent years as a large number of mortgages have been fixed-rate. French banks are playing catch-up as retail profits pick up as new loans are made at higher interest rates. BNP Paribas' share price has risen by nearly one-third this year, making it one of the best-performing stocks in the industry. Chief Executive Jean-Laurent Bonafé said the overall performance was partly due to "the acceleration of transformation, particularly in artificial intelligence."