Profits at BNP hit by one-off writedown

 
Elizabeth Fournier
BNP PARIBAS fourth-quarter profits missed analysts’ expectations yesterday despite a rise in revenue, after it had to write down the value of its stake in insurance firm Axa.

The €534m (£348m) Axa charge was put down to stock market volatility, which saw Axa shares drop well below their book value. BNP holds a 5.2 per cent stake in the insurer, which also posted a fall in profits yesterday (see above).

BNP’s net income was €1.55bn, up 13.6 per cent but below a consensus analyst forecast of €1.73bn. Group revenues rose 2.6 per cent in the quarter to €10.3bn, just missing forecasts of €10.5bn.

The bank was upbeat on the continued integration of its businesses following its acquisition of Belgium’s Fortis Bank in 2009.

Synergy targets for the businesses were revised up from €900m to €1.2bn by 2012, as the integration provided a boost to BNP’s revenue.

Corporate and investment banking revenues were worst hit, falling 6.4 per cent quarter-on-quarter, but the losses were offset by strong performances in equity derivative and corporate financing.

BNP raised its dividend to €2.1 per share, from €1.5 in 2009. It also hiked its cost-savings target for Belgian acquisition Fortis to €1.2bn, from €900m.

Chief executive Baudouin Prot said the company would not be on the lookout for any more acquisitions in the near future.

“I’ll be very blunt. At the moment, we are not very acquisitive. This year we will concentrate on organic growth,” he said.

Shares in BNP Paribas closed down 0.34 per cent at €58.77, having fallen to €57.82 in earlier trading.