BNP PARIBAS First amendment to the
2023 Universal registration document
and annual financial report
Universal registration document filed with the Autorité de Marchés Financiers on 22 March 2024
under n° D.24-0158
This first amendment to the 2023 Universal Registration Document has been filed with the AMF on 25 April 2024 as competent authority under Regulation (EU) 2017/1129 without prior approval pursuant to Article 9 of Regulation (EU) 2017/1129.
The universal registration document may be used for the purposes of an offer to the public of securities or admission of securities to trading on a regulated market if approved by the AMF together with any amendments, if applicable, and a securities note and summary approved in accordance with Regulation (EU) 2017/1129.
This Universal registration document may form part of a prospectus of the Issuer consisting of separate document within the meaning of the Prospectus Regulation.
Société anonyme (Public Limited Company) with capital of 2 294 954 818 euros
Head office : 16 boulevard des Italiens, 75009 PARIS
R.C.S. : PARIS 662 042 449
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Overview
1. | Quarterly financial information | 3 |
2. | Risks and capital adequacy - Pillar 3 (unaudited) | 70 |
3. Governance | 81 | |
4. | General information | 85 |
5. | Statutory auditors | 87 |
6. | Person responsible for the Universal registration document | 88 |
7. | Tables of concordance | 89 |
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1. Quarterly financial information
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FIRST QUARTER 2024 RESULTS
PRESS RELEASE
Paris, 25 April 2024
1ST QUARTER 2024
BNP Paribas reports very good 1st quarter 2024 performances and confirms its 2024 trajectory
- Stable revenues (€12,483m) driven by very solid business performances within each operating division
- Positive jaws effect (+1.1 point)
- Cost of risk1 (29 bps) still low, due to the quality of the loan portfolio
- Pre-taxincome up sharply (+7.4% vs. 1Q23 distributable3) to €4,363m
- Very high Net Income of €3,103m2 (-2.2% vs. 1Q23 distributable3), driven by operating performances
- €1.05bn share buyback finalised on 23 April 2024, and €4.60 dividend subject to General Meeting approval on 14 May 2024
- Earnings Per Share4 (€2.51) up sharply
- Financial structure very solid (CET1 ratio of 13.1%)
- Active management of capital including the divestment of Personal Finance businesses in Mexico and ongoing redeployment of capital from the Bank of the West divestment
On the strength of its 1st quarter 2024 results, BNP Paribas confirms its 2024 trajectory - revenues more than 2% higher than 2023 distributable revenues3 (€46.9bn), a positive jaws effect5, a cost of risk below 40 bps, and Net Income higher than 2023 distributable Net Income3 (€11.2bn).
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The figures included in this press release are unaudited.
As a reminder, on 29 February 2024 BNP Paribas reported restated quarterly series for 2023 to reflect, in particular, the end of the build-up of the Single Resolution Fund (SRF), effective 1 January 2024, and the assumption of a similar contribution to local bank taxes at a level estimated at about 200 million euros annually beginning in 2024, as well as an accounting heading separated from cost of risk and entitled "Other net losses for risks on financial instruments", beginning in the fourth quarter 2023. This press release reflects this restatement.
This press release includes forward-looking statements based on current beliefs and expectations about future events. Forward-looking statements include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives, and expectations with respect to future events, operations, products and services, and statements regarding future performance and synergies. Forward-looking statements are not guarantees of future performance and are subject to inherent risks, uncertainties and assumptions about BNP Paribas and its subsidiaries and investments, developments of BNP Paribas and its subsidiaries, banking industry trends, future capital expenditures and acquisitions, changes in economic conditions globally, or in BNP Paribas' principal local markets, the competitive market and regulatory factors. Those events are uncertain; their outcome may differ from current expectations, which may in turn significantly affect expected results. Consequently, actual results may differ from those projected or implied in these forward-looking statements due to a variety of factors. These factors include among others: i) BNP Paribas's ability to achieve its objectives, ii) the impacts from central bank interest rate policies, whether due to continued elevated interest rates or potential significant reductions in interest rates, iii) changes in regulatory capital and liquidity rules, iv) continued elevated levels of, or any resurgence in, inflation and its impacts, v) the various geopolitical uncertainties and impacts related notably to the invasion of Ukraine and the conflict in the Middle East, or vi) the precautionary statements included in this press release.
BNP Paribas undertakes no obligation to publicly revise or update any forward-looking statements in light of new information or future events. It should be recalled in this regard that the Supervisory Review and Evaluation Process is carried out each year by the European Central Bank, which can modify each year its capital adequacy ratio requirements for BNP Paribas.
The information contained in this press release as it relates to parties other than BNP Paribas or derived from external sources has not been independently verified and no representation or warranty expressed or implied is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained herein. Neither BNP Paribas nor its representatives shall have any liability whatsoever in negligence or otherwise for any loss however arising from any use of this presentation or its contents or otherwise arising in connection with this presentation or any other information or material discussed.
The sum of values contained in the tables and analyses may differ slightly from the total reported due to rounding.
The percentage changes stated for indicators in the first quarter 2024 profit-and-loss statement have been calculated with reference to the profit-and-loss statement on a distributable base for the first quarter of 2023, using the restatement of quarterly series reported on 29 February 2024. The 2023 distributable result serves as a basis for calculating the distribution in 2023 and reflects the Group's intrinsic performance post impact of the Bank of the West sale and post ramp-up of the Single Resolution Fund (SRF) excluding extraordinary items.
BNP Paribas' financial disclosures of the first quarter 2024 consists of this press release, the attached presentation, and quarterly series. The quarterly series are available at the following address: https://invest.bnpparibas/document/1q24-quarterly-series.
All legally required disclosures, including the Universal Registration document, are available online at https://invest.bnpparibas.comin the "Results" section and are made public by BNP Paribas pursuant to the requirements under Article L.451-1-2 of the French Monetary and Financial Code and Articles 222- 1 et seq. of the French Financial Markets Authority General Regulations.
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The Board of Directors of BNP Paribas met on 24 April 2024. The meeting was chaired by Jean Lemierre, and the Board examined the Group's results for the first quarter 2024.
Jean-Laurent Bonnafé, Chief Executive Officer, stated at the end of the meeting:
"On the strength of its diversified and integrated model, the Group achieved good performances in the first quarter 2024, thanks to business momentum in the operating divisions. BNP Paribas continues to demonstrate its ability to generate value and confirms its 2024 trajectory, with revenue growth expected to surpass 2% compared to 2023 and Net Income above the 2023 distributable result. We continue to focus on expanding our market shares, supporting our clients, and rolling out our strategic initiatives. BNP Paribas is well positioned for the new phase of the economic cycle. I thank the teams for their mobilisation."
SOLID RESULTS
First-quarterrevenues were stable (-0.4%), driven by very solid business performances within each operating division, offsetting a high base effect at Global Markets. Excluding this impact, revenues were up by about 3%6. Operating expenses decreased (-1.5%). The Group thus generated a positive jaws effect5 of 1.1 point. The effects of additional operating efficiency measures (400 million euros) are expected to begin showing up in the second quarter 2024.
Net Income (3,103 million euros) was driven by operating performances. Earnings per share4 amounted to 2.51 euros.
The Group finalised its 1.05-billion-euroshare buyback programme on 23 April 2024. The Board of Directors will propose a 4.60-eurodividend to shareholders at the General Meeting of 14 May 2024.
The financial structure is very solid, with a common equity Tier 1 ratio at 13.1%, and capital is managed actively, particularly with the divestment of Personal Finance in Mexico.
On the strength of its 1st quarter 2024 results, BNP Paribas confirms its 2024 trajectory - revenues more than 2% higher than 2023 distributable revenues (€46.9bn), a positive jaws effect, a cost of risk below 40 bps, and Net Income higher than 2023 distributable Net Income (€11.2bn).
This growth trajectory is based mainly on the strengthening of efficiency initiatives (2024 pre-tax impact of +400 million euros), the quality of the loan portfolio throughout the cycle, the redeployment of 55 basis points of capital freed up by the Bank of the West divestment before the end of the first half of 2024 (return on invested capital7 in 2025e>16%), the strategic repositioning at Personal Finance, and market share gains at CIB, while keeping capital allocation well-balanced. This trajectory reflects the impact of headwinds, including decisions by public authorities (2024 after-tax impact of -500 million euros) and the normalisation of used-car sale prices at Arval.
Revenues came to 12,483 million euros, down by 0.4% in comparison with the high base of revenues in the first quarter 2023 on a distributable basis, at 12,534 million euros.
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Revenues decreased by 4.0% at Corporate & Institutional Banking (CIB), as strong growth in revenues at Global Banking (+6.1%) and Securities Services (+6.8%) partly offset the 11.9% decline in Global Markets revenues.
Revenues at Commercial, Personal Banking & Services (CPBS)8 were stable at +0.4%, driven by growth at Commercial & Personal Banking (+1.0%), whose fees were up by 4.4% and net interest revenues by +4.9% excluding the impact of headwinds (Belgian government bond, ECB mandatory reserves, and inflation hedges in the amount of about 150 million euros). Revenues at Specialised Businesses decreased only slightly, by 0.7%, thanks to the increase at Personal Finance (+0.7%) which was driven by higher volumes and the ongoing improvement in margins at production. At Arval, used-car prices normalised at a high level. New Digital Businesses fared very well (+21.0%).
At Investment & Protection Services (IPS) revenues rose by 0.8%, driven by good business momentum at Wealth Management (+5.2%), Insurance (+4.2%) and Asset Management (+2.6%9). Excluding the contribution of Real Estate and Principal Investments, IPS revenues were up by +4.2%.
Group operating expenses came to 7,937 million euros (8,058 million euros in the first quarter 2023 on a distributable basis), down by 1.5%. CIB operating expenses decreased by 4.9%, particularly at Global Markets (-8.2%). The jaws effect was very positive at Global Banking (+6.5 points) and Securities Services (+7.8 points).
CPBS8 kept close control over operating expenses on the whole (+3.1%), up by 3.9% in Commercial
- Personal Banking, due in particular to the impact of Belgian bank levies. The jaws effect was positive at BNL and CPBL. Specialised Businesses' operating expenses rose by 1.2%, in support of their growth and transformation. The jaws effect was positive at Personal Finance, Leasing Solutions and Personal Investors.
At IPS, operating expenses were stable (-0.1%), decreasing at Wealth Management (-0.4%), Asset Management (-0.1%9) and Real Estate (-3.9%). The jaws effect was positive at IPS on the whole (+0.9 point) and strongly positive (+3.9 points) when excluding the contribution of Real Estate and Principal Investments.
Group gross operating income thus amounted to 4,546 million euros (4,476 million euros in the first quarter 2023 on a distributable basis).
At 640 million euros1 (592 million in the first quarter 2023 on a distributable basis), the Group's cost of risk stood at 29 basis points of customer loans outstanding, a low level, due to the quality of the loan portfolio. It reflects releases of provisions on performing loans (stages 1 and 2) of 123 million euros and provisions for non-performing loans (stage 3) of 763 million euros. The Group confirms its 2025 target of keeping cost of risk below 40 basis points each year.
Group operating income amounted to 3,901 million euros. In the first quarter 2023 it came to 3,884 million euros on a distributable basis.
Group non-operatingitems came to 462 million euros. They reflected the reconsolidation of activities in Ukraine10 (+226 million euros) and a capital gain on the divestment of Personal Finance in Mexico (+118 million euros).
Group pre-taxincome came to 4,363 million euros (4,062 million euros in the first quarter 2023 on a distributable basis).
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The average corporate tax rate stood at 29.8%. It reflects the first-quarter recognition of full-year taxes and contributions in accordance with IFRIC 21, a significant portion of which is not deductible.
Net Income, Group share thus came to 3,103 million euros in the first quarter 2024, close to its level of the first quarter 2023 at 3,173 million euros on a distributable basis.
Return on non-revaluated tangible equity stood at 12.4%.
As of 31 March 2024, the common equity Tier 1 ratio stood at 13.1% and the Liquidity Coverage Ratio11 (end-of-period)at 134% (148% as of 31 December 2023). The Group's immediately available liquidity reserve12 amounted to 446 billion euros, or more than one year to manoeuvre in terms of wholesale funding. The leverage ratio13 stood at 4.4%.
BNP Paribas continued to stand out in the first quarter 2024 in its commitment to ESG issues, as recognised by extra-financial ratings agencies and illustrated by its top-tier leadership in recent rankings. Several innovative solutions dedicated to each type of client were launched this quarter. For example, at CPBS, BNP Paribas Mobility launched an Arval and Leasing Solutions offering in Europe for combined leasing of electric vehicles and recharging stations, in order to facilitate the transition towards sustainable mobility. At IPS, BNP Paribas Asset Management launched its first global equities fund dedicated to the net-zero transition. The strategy is based on decarbonation and overweighted in sustainable investments.
The "Cease and Desist Order" of 30 June 2014, pertaining to violations of US laws and regulations governing economic sanctions, issued jointly by the Prudential Control and Resolution Authority (ACPR) in France and the Board of Governors of the Federal Reserve Board (FRB) in the United States, has been lifted, thus confirming the Group's accomplishment of its obligations under the remediation plan.
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CORPORATE AND INSTITUTIONAL BANKING (CIB)
CIB results were driven this quarter by very good performances by Global Banking and Securities Services and by a lower cost of risk.
CIB revenues, at 4,677 million euros, declined by 4.0% compared to the first quarter 2023. They were driven by strong growth at Global Banking (+6.1%) and Securities Services (+6.8%) partly neutralising the decrease at Global Markets' (-11.9%) due to the base effect arising from activity on the rates, currencies, and commodities markets. Activity on those markets had risen sharply in 2023 but suffered in the first quarter 2024 from a market environment marked by very low volatility in Europe.
CIB - Global Banking
Global Banking revenues, at 1,543 million euros, achieved a record quarter, up by 6.1%. They rose in EMEA and the Americas.
Revenues were up very sharply on the Capital Markets platform, particularly in the Americas (+29.8%14) and EMEA (+18.9%14).
They achieved a strong increase in Transaction Banking, especially in EMEA (+10.5%14), with deposits in cash management almost stable during the quarter.
In financings, business momentum was very good in EMEA on the bond markets (market up by 26%15 compared to the first quarter 2023) and syndicated loans (market up by 14%15 compared to the first quarter 2023). Loans, at 178 billion euros, fell by 1.4%14 compared to the first quarter 2023 but were up by 0.4%14 compared to the fourth quarter 2023. Deposits, at 217 billion euros, continued to grow (+1.0%14).
In rankings, Global Banking confirmed its first-tier status as a leader15 in EMEA in syndicated loans and bond issuance, a leader16 in European Large Corporate Transaction Banking (Trade finance and Cash Management), and the European and global leader17 in sustainable financing.
CIB - Global Markets
At 2,435 million euros, Global Markets revenues fell by 11.9%.
At 830 million euros, Equity & Prime Services revenues rose by 11.0%, a good performance driven particularly by Prime Brokerage activities (revenues up by 44%).
At 1,604 million euros, FICC revenues were down by 20.4% compared to a high base in the first quarter 2023. EMEA, the region in which FICC generated about 60% of its 2023 revenues, is also the region that was hit hardest by the normalisation on the rates, forex, and commodities markets after a period of very strong client activity in 2022 and in the first quarter of 2023. This normalisation was marked in particular by very low volatility, especially in January and February 2024, causing less sustained client activity compared to the high volumes in the first quarter 2023. However, in the first quarter 2024, overall credit market activity was up sharply, particularly on EMEA primary markets and in the Americas.
In terms of rankings, Global Markets confirmed its leadership on multi-dealer electronic platforms.
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Average 99% 1-day interval VaR, which measures the level of market risks, stood at 36 million euros, up by €7m vs. the fourth quarter 2023, due mainly to changes in interest-rate activity on the perimeter of developed markets.
CIB - Securities Services
At 699 million euros, Securities Services revenues rose by 6.8%, driven by the favourable impact of the interest-rate environment and the impact of the 9.9% increase in outstandings at the end of the period compared to the first quarter 2023. Transactions volumes decreased by 4.8% compared to the first quarter 2023, due mainly to lower market volatility.
Business activity was strong, marked by new mandates, particularly a mandate for custody of securities in the United States, amounting to 60 billion dollars in assets. Meanwhile, Private Capital activities continue to be developed.
CIB operating expenses, at 2,741 million euros, were down by 4.9%. The jaws effect was positive by 0.9 point.
CIB gross operating income thus decreased by 2.7%, to 1,936 million euros.
CIB cost of risk had 95 million euros in releases and stood at -16 basis points of customer loans outstanding. It reflects releases on provisions on performing loans (stages 1 and 2) and non- performing loans (stage 3).
CIB thus achieved pre-taxincome of 2,033 million euros, up by 2.4%.
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BNP Paribas SA published this content on 25 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 April 2024 16:07:58 UTC.
