France's largest bank, BNP Paribas, delivered a robust third-quarter performance, surpassing analyst forecasts as a surge in equities trading offset concerns about its exposure to the country's mounting debt crisis. Net income rose 13.5% year-on-year to €3.46bn, comfortably ahead of the €3.23bn average estimate from analysts polled by the bank.
The Paris-based lender also announced a €1.3bn share buyback programme, set to begin in November, and moved to downplay the risks posed by France's political and fiscal instability. Revenue climbed 9.5% to €13.76bn, led by the corporate and institutional banking division, which saw a 16.6% increase to €5.2bn.
Equities trading drives growth
Within that division, global markets revenue jumped 21.9% to €2.67bn, close to the record set in the first quarter of this year. Equity and prime services—which includes share trading and services for hedge funds such as lending and clearing—brought in €1.46bn, a 50% surge. Fixed income, currencies and commodities trading was flat at €1.22bn, as growth in Asia and foreign exchange offset weaker credit and interest rate business.
“The Group achieved a very strong third quarter driven by the operating performance across all three divisions,” said CEO Jean-Laurent Bonnafé in a statement.
The commercial and personal banking and services division, which serves households and businesses, saw revenue rise 3.6%, supported by the interest rate environment and higher fees. However, car leasing was a weak spot, with Arval and Leasing Solutions experiencing a 29.1% drop in revenue as used-car prices fell.
The cost of risk—money set aside for loans that may not be repaid—rose to €964 million, or 39 basis points of customer loans, just inside the bank's 2026 guidance of under 40 basis points.
Capital strength and buyback
BNP said its Common Equity Tier 1 (CET1) ratio, a key measure of financial strength, stood at 12.9% at the end of September. It expects this to rise above 13% by year-end, boosted by the sale of its Moroccan subsidiary BMCI. The buyback, approved by the European Central Bank, comes ahead of the payout of 2026 profits.
The bank confirmed its targets through 2028, including a 12% return on tangible equity this year, rising above 13% in 2028. It will set out a new 2030 strategic plan on 2 February. Shares traded about 1.5% lower at the open in Paris on Wednesday.
Playing down French debt troubles
The results land in the middle of France's political and fiscal crisis. The yield on French 10-year government bonds rose above 5% last week for the first time since 2002, as a divided parliament struggles to pass next year's budget amid mass street protests. Ratings agency Moody's kept France's rating unchanged on Friday, but with a negative outlook.
BNP said it held around €19 billion of French government bonds, about €16 billion of which are booked at amortised cost, an accounting treatment under which swings in their market price do not hit its capital. It estimated that a further 0.5% widening in the gap between French and German bond yields would trim its CET1 ratio by only about 0.02 points.
France generated under 10% of the parent company's pre-tax income in 2025, roughly half its share in 2016, according to the bank's results presentation, meaning BNP has significantly diversified away from the French market in recent years. This diversification is a key part of the bank's narrative as it navigates the ongoing turmoil in French bonds.
