Acquisitions were key for BNP Paribas

16 February 2007

BNP Paribas SA has said that acquisitions last year contributed importantly to its increased fourth-quarter net profit.

The largest bank in France saw a 28 per cent net profit rise in the fourth quarter, reaching €1.72 billion (£2.26 billion) from €1.34 billion.

Revenues also rose significantly, from €1.34 billion a year earlier to their current level of €1.72 billion.

An increase in its investments in larger-growing markets was a significant factor in the bank's performance. Rome-based Banca Nazionale del Lavoro was one such acquisition, which gained it an extra three million retail customers and contributed €177 million to pre-tax profit.

There are concerns ahead, though, in the European banking sector - as Yves Marcais, a strategist at Global Equities in Paris, told Bloomberg.

He said: "European banks posted great results for 2006 but the question now is, how can such good results be sustainable this year? This concern is what is pushing shares down today."

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