Dizzied by the conundrums of the year, European banking leader BNP Paribas is set to shine in the near future. [1] We are getting closely through the study of Apme FX: Banking groups. Valued at above $70 billion, the 22-year-old international banking group headquartered in Paris has been subdued by the calamitous downturns of 2022, driven down by growing reluctancy of investors, businesses and households in spending and borrowing money.

Lately, the banking behemoth overachieved the figures recorded previously as the French group basks in profits and glory. While BNP Paribas expects to be shaken up by some headwinds in the short term, characterized by the re-birth of market recovery and revitalizing willingness to spend & invest, things seem brighter in the long run.

Recent Performance

BNP Paribas recently posted their Q3 2022 quarterly results for the three months ended September:

·      Revenue: €12.31 billion

·      Operating income: €4.54 billion

·      Net income: €2.76 billion

A phenomenal quarter by the brilliant banker, BNP Paribas outperformed its earlier figures. Revenue grew by 8% on a year-to-year basis, operating income shot up nearly 7% in one years’ time while net income grew by above 10% when compared to the results of 2021’s third quarter.

The company demonstrated strong resilience despite dwindling markets, driven by increased market demand for derivatives on commodities, rates and foreign exchange. Yet, CEO Jean-Laurent Bonnafé noted that the “fast acceleration in bond yields” in Europe have created uncertain market conditions for the company, and that political risks continue to loom on the firm.

While asset management revenues took the blow in the recent quarter, higher wealth management revenues alongside robust growth in principal investments have attributed to the recent prosperity of BNP Paribas, and this can be noticed when studying the price chart of the company’s stock.

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Looking at the BNP Paribas stock (BNP.PA) from a technical perspective using the TradingView chart, it can be seen that the price-tag of €53.63 hovers between a support level of €42 and a resistance level near €54. The short-term trend may not be too optimistic if the stock fails to break the resistance mark, but the long-term trajectory is looking more relieving.

Analysts of renowned financial institutions expect a €17 rise in the stock price as an average consensus to €70, marking a 30% upside from today’s valuation. The low estimation sits at €61 and the high projection nears the €80 mark. [2]

Future Outlook

The future of BNP Paribas seems to center around exponential growth catalyzed by acquisitions and business restructuring. In early December of 2022, BNP Paribas Asset Management (AM) announced that it acquired a majority stake in Denmark-based International Woodland, which focuses on providing sustainable services for investment management, advisory services and agriculture investments services.

BNP Paribas has also very recently announced the creation of a new business unit by the name of Private Assets, which aims to bolster the private asset management business by endeavors such as fundraising from third-party clients.

As said by Renaud Dumora, Deputy Chief Operating Officer of BNP Paribas and Head of Investment & Protection Services, the private asset management market has tripled in size the past decade, and that it marks as one of the paramount growth drivers of the company.

Peter Svoreň, Executive director of APME FX

[1,2] Forward-looking statements are based on assumptions and current expectations, which may be inaccurate, or based on the current economic environment which is subject to change. Such statements are not guaranteeing of future performance. They involve risks and other uncertainties which are difficult to predict. Results could differ materially from those expressed or implied in any forward-looking statements.

* Past performance is no guarantee of future results. Forward-looking statements are based on assumptions and current expectations, which may be inaccurate, or on the current economic environment, which may change. Such statements are not guarantees of future performance. They involve risks and other uncertainties that are difficult to predict. Results may differ materially from those expressed or implied by any forward-looking statements.