BNP Paribas (OTC:BNPQY) has reported a resilient Q3 2023 performance, navigating through economic turbulence, market volatility, and geopolitical upheavals such as Russia's invasion of Ukraine. The bank's net income reached 2.66 billion euros, marking a 4% year-on-year decrease in line with market forecasts given the uncertain economic outlook. The bank achieved a 12.7% Return On Tangible Equity (ROTE), aligning with its 2025 goal of 12%.
Under CEO Jean-Laurent Bonnafe's strategic direction, over 85% of the bank's ambitious 5 billion euro share buyback program was completed in 2023. This was funded by the strategic sale of Bank of the West, its former US retail subsidiary.
In response to rising interest rates, BNP Paribas minimized its US commercial lending presence while enhancing global investment banking operations through strategic resource allocation. Despite experiencing declines in trading revenue and FICC sales similar to Deutsche Bank (ETR:DBKGn) and Barclays (LON:BARC) PLC, the bank countered these challenges with a 4% group sales increase.
The bank also reported a significant 20% upturn in global banking business sales in Q3. This resilience is exemplified in the corporate and investment bank division, which saw a 13% YoY increase in pre-tax profits due to the performance of its securities services team and global banking division.
The securities services team's profits rose by 25%, while the global banking division, comprising equity capital markets, debt capital markets, syndicated loans, and transaction banking, saw a 90% increase. The transaction banking unit, which manages corporate treasury payments, had nearly a 60% growth in EMEA revenues.
Despite underwhelming performance from macro trading and the ex-Deutsche Bank prime broking platform, roles in securities services and transaction services are appealing. They offer competitive salaries on par with M&A and sales and trading, slightly lower bonuses, but reasonable working hours, as reported by Wall Street Oasis.
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