NET INCOME, GROUP SHARE, OF 1,007 MILLION EUROS (- 13%)
A RETURN ON EQUITY AFTER TAX OF 16.1% FOR THE FIRST HALF OF THE YEAR
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In a context marked by a deep crisis in the equity as well as corporate debt markets, the Group posted in the second quarter 4,129 million euros in NBI, down 5.5% compared to the second quarter 2001.
Operating expenses and depreciation rose only 0.7% to 2,708 million euros (+0.1% at constant scope and exchange rates) and gross operating income fell 15.6% to 1,421 million euros (- 16.1% at constant scope and exchange rates).
A moderate increase in provisions (+20 million euros) and an also moderately higher contribution from non-operating items (+37 million euros) helped limit the fall in the net income, group share, to 13% (1,007 million euros).
The performance of Corporate and Investment Banking and Asset Management and Services, affected by the crisis, nevertheless shows that they are competitive businesses, with interim cost/income ratios of 61.7% and 61.6% respectively.
Retail Banking's business operations continue to grow and its performance significantly enhanced.
The Board of Directors of BNP Paribas examined the Group's results for the second quarter of the year as well as the interim accounts.
The second quarter 2002 saw a considerable deterioration of the banking and financial services industry world-wide. Equity markets fell sharply in June, in particular in the second half of the month. This trend, in connection with uncertainties about the reliability of a number of large corporations' financial statements, left investors distrustful of corporate debt instruments and therefore led to a plunge in their values. Customer activity in capital markets further contracted, in particular at the end of the period.
Given this situation, BNP Paribas Group's net banking income was down 5.5% in the second quarter 2002, compared to the second quarter 2001, at 4,129 million euros (-6.2% at constant scope and exchange rates). This decline is due to the crisis in the markets, which has negative repercussions on trading revenues (-27.9% at 481 million euros) and fees (-2.1% at 1,586 million euros).
The trend in operating expenses and depreciation shifted as a function of this situation: they rose only 0.7% to 2,708 million euros, a level that is virtually stable (+0.1% at constant scope and exchange rates).
Gross operating income totalled 1,421 million euros, down 15.6% compared to the second quarter 2001 (-16.1% at constant scope and exchange rates).
Provisions were up 6.5% at 328 million euros (+7.6% at constant scope and exchange rates), compared to the second quarter 2001. Non-operating items were up 9.3% at 434 million euros, and net income, group share, came to 1,007 million euros (-13.0% compared to the second quarter 2001, or -10.0% at constant scope and exchange rates).
For the whole first six months of the year, cost/income ratio was 63.9 %, a testimony to BNP Paribas' strong resilience in a difficult environment. The Group's after-tax return on equity reached 16.1 % for the first half of 2002.