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BNP earnings fail to shine
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March 8, 2000: 3:15 a.m. ET
France's largest bank posts 52% rise in FY99 profit on capital-markets surge
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LONDON (CNNfn) - Banque Nationale de Paris, France's largest bank, on Tuesday posted a smaller-than-expected 52 percent rise in full-year earnings and announced plans to invest 700 million euros ($672 million) in its Internet strategy over the next three years.
BNP, which leapfrogged rival Société Générale after an acrimonious bid battle for investment bank Paribas, said net profit before exceptional charges rose to 2.615 billion euros from 1.77 billion a year earlier. Analysts polled by Reuters expected, on average, profit of 2.8 billion euros.
The result was lifted by a stellar performance from its investment-banking unit which, including Paribas' contribution, posted a six-fold jump in pretax earnings to 1.78 billion euros, reflecting the booming capital markets activity which gave a lift to most of the European banking sector last year.
 Provisions dropped to 1.07 billion euros from 1.77 billion in 1998, reflecting the robustness of France's economy, while the domestic retail banking business reported a 24 percent rise in pretax profit to 759 million euros. Earnings from international retail banking doubled to 324 million euros.
BNP took an exceptional charge of 585 million euros for the cost of restructuring.
The earnings announcement was accompanied by a commitment by BNP to accelerate its investment in Internet banking. The bank's online retail and brokerage services have already attracted 250,000 clients. The bank plans to team up with France Telecom (PFTE) in a non-exclusive deal to offer banking services via cellular phones. It will also link with pay-TV operator Canal Plus (PFTE) to provide interactive banking services via television sets.
BNP (PBNP) shares opened down 2.2 percent at 88.2 euros in Paris Wednesday. 
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BNP Group
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