The French bank's global markets unit saw continued strong client demand on rates, forex and commodity derivatives markets in Q2 22.
Global markets was the most profitable business line within BNP Paribas Corporate and Institutional Banking (CIB) in the second quarter of 2022, delivering a 15.3% increase in revenues, which stood at €2.2 billion, according to bank's latest quarterly report.
The unit recorded 'very robust client activity on the whole'. Fixed income, currencies & commodities (FICC) revenues increased 14.8% to €1.3 billion YoY on the back of 'very strong client demand, driven in particular by reallocation and hedging needs in rates and forex, emerging markets and commodity derivatives products', stated the report.
The bank also reported ‘good momentum’ in its equity derivatives business and an acceptable level of activity in prime services and cash equities, despite a less active primary market in Q2 22. Revenues from equity and prime services rose 16.1% to €878m YoY driven by ‘robust client activity, particularly in equity derivatives, by a contribution of about €70 million from BNP Paribas Exane, and by a good contribution from prime services’.
Global banking and security services reported €1.25 billion and €663m revenues in Q2 22, up 0.8% and 16%, respectively.
Overall CIB revenues increased by 10.6% to €4.11 billion in Q2 22 YoY, accounting for 32.2% of the total at BNP Paribas. The division's pre-tax income grew 5.3% to €1.72 billion YoY.
BNP Paribas’ CIB has recently seen a new set-up of global equities segment, which aims to integrate cash equities, prime services and equity derivatives (EQD). The EQD structuring team in Asia Pacific (Apac) is led by Etienne Grisey (right), who has relocated to Singapore from Hong Kong SAR in early August reporting to Apac head of global equities Vincent Desmarest.
The bank’s commercial, personal banking & services (CPBS) revenues were up by 11.1% to €7.18 billion YoY, leading to pre-tax income of €2.38 billion. Investment & protection services (IPS) recorded €1.72 billion revenues, up 2.2% YoY, or pre-tax income of €729m.
Groupwide, BNP Paribas revenues increased by 8.5% to €12.78 billion in Q2 22 YoY, which led to a €3.18 billion net income, up 9.1%.
The bank headed by CEO Jean-Laurent Bonnafé (pictured), issued 750 non-flow structured products across 13 markets during this period, according to SRP data.
In its local market France, 297 structured products comprising 162 medium term notes and 135 certificates were launched deployed with a total of 10 payoffs.
All but 24 of the products had a knockout feature and the majority were tied to a single index (157 products). There was one interest rate-linked product, which has a three-year tenor and is linked to the Euribor.
SRP has also registered 79 structured products issued by BNP Paribas in Italy, which were sold €522.3m in Q2 22, down 20% YoY.
Outside of Europe, the bank was active in Taiwan and Japan – in Tawian it marekted 198 structured notes, lower than 294 in the prior-year period; and in Japan, it collected US$245.6m-equivalent from 23 Uridashi notes.
BNP Paribas was also one of the 16 active providers in Hong Kong SAR’s listed structured products market, with 61 derivative warrants and 451 callable bull bear contracts (CBBCs).
Click in the link to read BNP Paribas’ full first quarter 2022 results.