BNP Paribas, the French multinational bank, has reported its first-quarter earnings, outperforming analyst predictions. Despite a slight 2% decline in net income to €3.1 billion for Q1, the bank’s performance surpassed the €2.48 billion estimated by Bloomberg analysts. Lower-than-anticipated provisions and expense reductions were cited as key contributors to this achievement.
While overall revenue experienced a marginal 0.4% decrease to €12.5 billion, it exceeded market expectations of €12.2 billion. However, a significant 20% decline in income from trading debt securities, currencies, and commodities from the previous year tempered this growth, despite notable gains in equities trading and capital markets.
In the realm of auto and asset finance, BNP Paribas’ divisions, Arval and Leasing Solutions, navigated a landscape marked by the gradual normalisation of used-car prices at elevated levels. This environment proved favourable for vehicle sales, with 109,000 vehicles sold in Q1 2024 and a robust expansion in the Arval financed fleet, surpassing 1.7 million financed vehicles.
Leasing Solutions witnessed a notable rise in outstandings by 24.4% compared to Q1 2023, reaching €23.8 billion. The division’s business momentum remained strong, evidenced by an 11.0% increase in production volumes on equipment markets and healthy margin levels. However, revenues experienced a slight decline of 4.0% to €942 million.
Conversely, Arval reported a decline in revenues for the quarter, down by 5.8% compared to Q1 2023, primarily due to the gradual normalisation of used-car prices. This impact was partially offset by the volume-driven increase in Leasing Solutions revenues.
Operating expenses for Arval and Leasing Solutions rose by 3.7% to €393 million, driven by inflation and business development initiatives. Pre-tax income for the combined divisions decreased by 9.5% to €489 million.
Despite challenges, BNP Paribas remains optimistic about the trajectory of its auto and asset finance divisions, with strategic partnerships and solid business drives paving the way for continued growth in the dynamic financial landscape.
