BNP Paribas announces better-than-expected profits

6 August 2008

Profits have fallen by 34 per cent over the second quarter at BNP Paribas.

The Paris-based bank said today that a combination of credit crunch-induced writedowns and increased provisions for potential bad debt led to net income falling from $3.5 billion in April-June 2007 to $2.3 billion this year.

A total of $839 billion was also written off by the bank over the three-month period.

However, the profits declaration beat out previous analysts' expectations - and shares in BNP Paribas rose by 6.1 per cent in Paris as a result.

Richlieu Finance fund manager Salah Seddik told Bloomberg that these results represented a comparatively strong performance by BNP Paribas.

"The bank isn't exposed to the most toxic products linked to subprime,'' she said, adding that the retail unit's performance was "respectable" over the second quarter.

Rival French bank Societe Generale declared that it earned around $1 billion net from April to June earlier this week.

This was a 63 per cent drop over the same period a year ago.

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