Revenues Rise At BNP Paribas' Wealth, Asset Management Arm

Tom Burroughes

7 February 2023

today said that its wealth and asset management division’s revenues rose 6 per cent year-on-year to €3.896 billion ($4.18 billion) in 2022, driven by rising net interest income in the wealth arm, rising principal investment and higher real estate revenue.

On the asset management side, revenues were hit by a “highly unfavourable market environment,” the Paris-based group said of the fall to stock and bond markets last year.

Operating costs rose 4.6 per cent on a year ago to €2.806 billion.

Wealth and asset management pre-tax income rose 10 per cent, at €1.244 billion. This result included the impact of lower capital gains on sales made in 2022, compared with 2021.

Across the BNP Paribas business as a whole, net income attributable to equity holders came to €10.196 billion in 2022, rising 7.5 per cent compared with 2021. Excluding exceptional items, the figure was €10.718 billion, rising 19.0 per cent compared with 2021.

As of 31 December 2022, the Common Equity Tier 1 ratio – a common measure of a bank’s financial strength – was 12.3 per cent.

Disposal
At the start of February BNP Paribas said it was completing its sale of US-based Bank of the West to BMO Financial Group for $16.3 billion. The transaction generated a one-off (after-tax) capital gain of about €2.9 billion and boosted BNP Paribas’ Common Equity Tier 1 ratio by about 170 basis points. BNP Paribas intends to redeploy about €7.6 billion in Common Equity Tier 1 capital release to improve “long-term value creation” by speeding up organic growth, targeted investments in technologies and innovative and sustainable business models, and “bolt-on acquisitions.” It also intends to launch €4.04 billion in extraordinary share buybacks in 2023 related to the sale of Bank of the West.

At its annual general meeting on 16 May, the bank said its board of directors intends to pay out a dividend of €3.90 in cash, equivalent to a 50 per cent pay-out ratio of 2022 distributable income.