Earnings call transcript: BNP Paribas sees stable growth, strategic shifts in Q2 2025

BNP Paribas reported a 2.5% increase in group revenues year-on-year during its Q2 2025 earnings call, although net profit declined by 4% due to a one-time low tax charge. Despite this, the bank remains optimistic about its future, forecasting net profit above €12.2 billion for 2025. The company also announced a first interim dividend of €2.59 per share. According to InvestingPro data, BNP Paribas has maintained dividend payments for 34 consecutive years and currently offers a 6% dividend yield. The stock saw a modest increase of 0.31%, reflecting cautious investor optimism, with the shares currently appearing undervalued based on InvestingPro’s Fair Value analysis.

Key Takeaways

• Group revenues increased by 2.5% year-on-year.
• Net profit decreased by 4% due to a one-time tax charge.
• First interim dividend of €2.59 per share was announced.
• Completed a €1.8 billion share buyback program.
• Acquisition of AXA IM finalized on July 1st.

Company Performance

BNP Paribas exhibited resilience in a challenging market, with a 2.5% rise in group revenues compared to the previous year. The decline in net profit by 4% was attributed to a one-time low tax charge. Trading at a P/E ratio of 8.3x and showing a revenue growth of 6.45% over the last twelve months, the bank’s diversified business model and strategic initiatives, such as the acquisition of AXA IM, are expected to drive future growth. InvestingPro analysis reveals several more positive indicators about the company’s financial health and growth prospects, available to subscribers.

Financial Highlights

• Revenue: Increased by 2.5% year-on-year.
• Net Profit: Down by 4% due to a one-time tax charge.
• Common Equity Tier One (CET1) Ratio: Stable at 12.5%.
• Interim Dividend: €2.59 per share.

Outlook & Guidance

BNP Paribas anticipates accelerating revenue growth in the second half of 2025, targeting a return on tangible equity of 11.5% in 2025 and 12% in 2026. The bank expects net profit growth driven by net interest income in its commercial banking segment and is preparing for a new strategic plan in 2027. With an InvestingPro Financial Health Score rated as "GOOD" and operating with a moderate level of debt, the bank appears well-positioned for future growth. Discover more detailed insights and metrics with a comprehensive Pro Research Report, available exclusively on InvestingPro.

Executive Commentary

• "We expect our net profit for 2025 to be above €12,200,000,000," said Jean Laurent Bonaffet, Group CEO, highlighting the bank’s confidence in its financial performance.
• "Our diversified business model enables us to be less cyclical than many other banks," noted Lars Machenil, Group CFO, emphasizing the stability of BNP Paribas amidst market volatility.

Risks and Challenges

• Macroeconomic Pressures: European GDP growth remains uncertain, potentially impacting financial markets.
• Tariff Uncertainties: Fluctuating trade policies could affect international operations.
• Corporate Environment: A challenging corporate landscape may slow down business investments.
• Regulatory Changes: The implementation of new regulations like the Save and Invest Union (SIU) could require strategic adjustments.

BNP Paribas continues to navigate a complex financial landscape with strategic acquisitions and a focus on innovation. While immediate results show mixed outcomes, the bank’s forward-looking strategies and stable financial metrics position it for potential growth in the coming years.

Full transcript - Danone (BNP) Q2 2025:

Conference Operator: Ladies and gentlemen, we are currently on hold for the presentation of BNP Paribas Second Quarter twenty twenty five Results hosted by Jean Laurent Bonaffet, Group Chief Executive Officer and Lars Machenil, Group Chief Financial Officer. If you would like to participate to the Q and A session, please make sure to be in a quiet area to maximize audio quality. If noise volume is too high, we may reconsider your participation to Ladies and gentlemen, we are currently on hold for the presentation of BNP Paribas Second Quarter twenty twenty five Results hosted by Jean Laurent Bonaffet, Group Chief Executive Officer and Lars Machenil, Group Chief Financial Officer. If you would like to participate to the Q and A session, please make sure to be in a quiet area to maximize audio quality. If noise volume is too high, we may reconsider your participation to the Q and A session.

In order to ensure that all attendants are able to participate, please limit your questions to a maximum of two. Thank you for holding. The conference will start shortly. Ladies and gentlemen, we are currently on hold for the presentation of BNP Paribas Second Quarter twenty twenty five Results hosted by Jean Laurent Bonaffet, Group Chief Executive Officer and Lars Machenil, Group Chief Financial Officer. If noise volume is too high, we may reconsider your participation to the Q and A session.

In order to ensure that all attendants are able to participate, please limit your questions to a maximum of two. Thank you for holding. The conference will start shortly. Good afternoon, ladies and gentlemen, and welcome to the presentation of the BNP Paribas Second Quarter twenty twenty five results with Jean Laurent Bonifet, Group Chief Executive Officer and Lars Machenil, Group Chief Financial Officer. For your information, this conference call is being recorded.

Supporting slides are available on BNP Paribas IR website, invest.bnppariba.com. I would like now to hand the call over to Jean Laurent Bonifet, Group Chief Executive Officer. Please go ahead, sir.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas: Thank you. So good afternoon, ladies and gentlemen. Lars and I are pleased to present today a summary of our strong second quarter results and how it confirms our twenty twenty fourtwenty twenty six trajectory. For 2025 specifically, we’re also confident to announce that we expect more than EUR 12,200,000,000.0 net profit for this year, as I will explain later. We will be relatively brief on divisional details as you have most of them in our documents.

So moving to Slide four, you can see that our revenues are up 2.5% this quarter. CIB posted a 4% revenue growth despite an elevated base in the second quarter twenty twenty four and the U. S. Dollar weakness. For all three businesses, Global Banking, Global Markets and Security Services with the best second year in fourteen years in fifteen years.

CPBS was marginally up year on year despite lower used car sales results at Arval. This is in line with our trajectory. The quarter confirmed the acceleration of the NII in our commercial banks in Eurozone as expected, with a growth of more than 2% and we anticipated the second half to show further acceleration. Euromain once again posted very strong revenues growth at about 22%, thanks to strengthened performance in Turkey and Poland. Personal Finance is starting to show acceleration and is up about 3%.

Moving to IPS, it posted a 4.4% growth, particularly thanks to insurance and wealth management. We are pleased to have welcomed AXA I’m employees in our group on the July 1. I will elaborate on AXA I’m later on. Finally, regarding the Corporate Center, we saw an improvement as mentioned during first quarter results. Our commitment to control to cost control remains strong and we are on track to deliver our cost savings of EUR 600,000,000 this year with EUR 190,000,000 of additional savings implemented in Q2.

Overall, we generated positive jaws effect of 1.7 points this quarter, above our ambition of 1.5. At 38 bps, our cost of risk remains with our guidance of less than 40 bps despite a more challenging environment. Our cost of risk includes Stage three provisions of 33 bps, down nine bps year on year. The 2024 saw Stage one and two benefiting from 12 bps of releases compared to a small addition this quarter. All in all, our net profit was down 4% due to a punctually low tax charge in the second quarter twenty twenty four without compromising our trajectory of profitability as this tax impact iron out over the full year 2024.

Our CET1 is stable quarter on quarter at 12.5% and Lars will elaborate on this later. Finally, we confidently confirm our distribution policy of 60% and are pleased to announce our first interim dividend of EUR 2.59 per share, which represents 50% of our EPS for the first half. EUR 1,800,000,000.0 share buyback program was completed in June and the shares will be canceled. After solid performance in Q2, we expect a sharp acceleration in the second half, and I will explain on the next slide. So now moving to Slide five.

We’re pleased to confirm that we expect our net profit for 2025 to be above EUR 12,200,000,000.0, mainly driven by strong acceleration in revenues in the second half of the year at more than 5% excluding AXA I’m This revenue growth is in the place that it will largely come from the acceleration of the NII in our Eurozone commercial banks and at personal finance on margins, reflecting the current rate environment. These additional revenues do not require much additional costs, which means they will feed directly to our gross operating income and profit before tax. We will also continue our cost savings measures, supporting jaws at roughly plus 2.5 points. Once we add to the strong growth in gross operating income, the first time contribution from AXA, we expect that our net profit will exceed EUR 12,200,000,000.0 for the full year, marking a sharp increase in the second half. Moving now to Slide six, you are of course very familiar with the Slide six and I’m pleased to reiterate our trajectory for twenty fivetwenty six.

Return on tangible equity of 11.5 in 2025, 12% in 2026, leading to more than 7% group net income growth CAGR and more than 8% EPS growth CAGR. Our 26% return on tangible equity is only a stepping stone towards further improvement. Our targets will be achieved thanks to key levers that you will have in mind, starting with CIB. We’ll continue to grow market shares in a capital conscious manner and we’ll be ready for the save and investment union, thanks to our originate to distribute model. Moving to CPBS, well, two deep dives in June on CPBF and personal finance, demonstrating to you that these two businesses alone can add one full point of return on tangible equity by twentieth.

CPBS will amongst others benefit from the sharp acceleration in NII, both in the commercial banks and personal finance. We recently reinforced our governance of the commercial banks in The Eurozone in order to materialize our investments, accelerate cross selling and continue our efforts on SRT. Moving to IPS, we will continue the dynamic organic growth, which will be amplified by the acquisition of HSBC West Management Germany and of course AXA IA. Finally, we will continue our efficiency efforts with €600 additional cost savings by in both ’25 and ’26. And I now hand over to Lars who will remind you of this quarter’s achievements.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: Thanks, Jean Laurent. If you can swipe to Slide 10, where you can see that the 2025 was driven by solid business performance within each division. Overall group revenues were up 2.5% year on year and we expect more than 5% in the second half. If we look at the divisions, CIB had a record second quarter, as Jean Laurent said, up 4% year on year, driven by a very good performance across all three business lines. If we look at Global Banking, which was stable at a record high, reflecting strong commercial dynamism, but also some degree of wait and see, also the U.

S. Dollar impact and the negative impact of lower rates. Our pipeline within Global Banking is strong for the remainder of the year. If we turn to Global Markets, where revenues were up 5.6% driven by a very strong performance of FICC when compared in particular to our U. S.

Peers and FICC is up 27%. FICC was indeed strong in all regions, particularly driven by FX, but also credit. Equity and Prime Services was down about 15% due to the high base effect a year ago and compared with our U. S. Peers who are more exposed than us to the flow business, which was very strong this quarter on the other side of The Atlantic.

We were also impacted by lower demand for structured products in the context of the uncertainty post Liberation Day. However, if we look at the first semester results at EUR2.2 billion, they represent a record for EPS driven in particularly by Prime and Cash. If we now turn to the third division, Security Services, it was up 7.6% driven by strong balances and transactions as well as resilient interest margin. If we now turn to the second division, which is CPBS, which illustrated and demonstrated the pivotal performance. If you look at it, the revenues are up 0.4%, but what is worth mentioning are the two main divisions within it.

If we start with the commercial banks, they were basically up 5% this quarter, stronger than the trajectory for the next two years. Within this, we look at the commercial banks in the Eurozone, they grew their revenues 1.2% and we reiterate our target of more than 3% this year. Indeed, why do we say this? Because on one hand, the rebound of net interest revenues will accelerate in the second half of this year as the lag from deposit mix has tapered off. Moreover, the lower rates environment should be supportive of a stabilizing deposit mix and the shape of the yield curve should enable us to continue our reinvestment on the long end of the curve leading to a progressive net interest income pickup as we have announced and as the second quarter illustrates this pivot.

If with this after the Eurozone banks, look at Europe Mediterranean and so the revenues were up 22.7%. This is due to improved margins both in Poland and Turkey as well as an increase in fees and this in particularly payments in Turkey. Of course, the environment in Turkey going forward could potentially be less favorable due to a slowing decrease in interest rates. So this is then basically the commercial banks. If we then turn to the specialized businesses, they were down 7% year on year.

And this impacted by the ongoing normalization, as you know, of used car prices and as you know, as we have flagged it before. If you look organically, Arval performed extremely well again this quarter, so up 8.3%. The growth is supported by fleet growth of 4.6% and outstandings growing by 11.2%. If you look at Personal Finance, where you see a solid commercial performance with loan growth of 2.7% combined with margin improvements coming from repricing. We have described this in our deep dive for Personal Finance and we are confident that the margin improvement will accelerate in the second half of the year.

Last, within CPBS, a very good performance from the new digital businesses and personal investors, up organically 11% this quarter, thanks to further growth in client acquisition as well as a high level of transactions in the light of Liberation Day. If with this, we move to the third division, IPS. We saw strong growth in fees, thanks to a high level of transactions. If we look at assets under management, they were boosted by strong inflow and strong performance effects, but were significantly impacted by the strengthening of the euro. IPS is about to become a sizable driver of our growth with the acquisition of AXA EM, which we closed early July.

If we look at insurance revenues, they were up 8.2% driven particularly by a healthy savings in France, the increased contribution from Ageas and the impact of recent acquisitions. Wealth Management was up 6.1% on strong inflow and strong fee growth. If we turn to Asset Management, which was down 1.8% despite strong inflow and transactional activity due to financial income and in particular real estate. Our Asset Management division includes the activity real estate which continued to weigh. Let me add finally a comment on the Corporate Center.

As we highlighted at the first quarter, the revenues can be volatile from one to another, but you see that the second quarter is in line with our full year guidance of about zero revenues, excluding the impact of insurance related effects. If with this, we turn to Slide 11, where we show that our cost discipline is paying off. At group level, the jaws stand at 1.7 points consistent with our stated trajectory for 2026 of 1.5. We continue to allocate cost growth to fund development while we offset inflation by cost savings. If you look at CIB, positive jaws 0.7 points with cost growth driven mainly by increased activity.

CPBS also positive jaws 0.5 points and jaws are positive in all activities except as we mentioned before. So the lateral phase is significantly lower base effect from car sales revenues in the second half as previously stated. So the tapering down of the resell had the highest impact in the second in the first half of the year and will be materially lower in the second half. Finally, IPS reported positive jaws of 5.2 points with a drop in cost of 0.7% even with our ongoing investments in the business. So jaws are positive in Insurance and Wealth Management.

If we look at Slide 12, where we focus on the cost savings and efficiency measures, which basically allow the jaws effect. And this quarter, you see that we implemented EUR 190,000,000 of new cost savings totally consistent with our full year target and broadly offsetting the impact of inflation. Having looked at those three first elements of the P and L, let’s now look at the cost of risk on Slide 13. On this slide, you can see that our diversified balance sheet enable us to protect profitability. Our cost of risk of 38 basis points over outstanding is at the moderate level across our activities with a base effect a year ago in the second quarter.

Indeed, in the second quarter of twenty twenty four, the Group released Stage one and two provisions for EUR $275,000,000 notably in Global Banking. In particular, if you go back to the stage three provisions, which have improved nine basis points year on year. So the stage three are nine basis points lower than they were a year ago and they stand at 36 basis points. And so they reflect the good quality of our portfolio despite a challenging economic environment. So if we now talk about the stages one and two, our overall stock of provisions for these is stable and it stands at EUR 4,100,000,000.0, equivalent to more than one year worth of the current Stage three run rate.

If we now look at it by division, we know there’s normalization from a low base at Global Banking, as we previously mentioned, Europe Med and BNL and from a high base in France. So continues to represent close to 50% of group cost of risk and the drop of Stage three provisions there confirms our expectation of gradual structural improvement. If we now move to the impact of U. S. Tariffs, while we observe a certain wait and see attitude among clients, mainly due to the ongoing uncertainty around these tariffs, and this is expected to ease once greater clarity emerges.

In the meantime, we maintain a strong focus on high quality counterparties, so 75 is investment grade and continue to closely monitor liquidity, credit and market risks. So having looked at the P and L, let’s now look at the balance sheet and in particular capital management on Slide 15. If we start from the second quarter in twenty twenty five, our financial communication will be based on the phased in capital ratios. This to align with the regulatory requirements comparison, So the phased in metric is the base for MDA calculation. So the calculation that would eventually limit dividends.

Secondly, it reflects the group’s 2030 horizon. And thirdly, it matches the standard used by the peer group. Looking at the second quarter, our common equity Tier one phased in a stable quarter on quarter and stands at 12.5%. This quarter reflects the typical 10 basis points of organic capital generation, which was compensated punctually by amongst others model updates. Additionally, we offset our limited organic RWA growth by RWA optimization.

So the quarter confirms our intrinsic capital generation and us being well on track to be above our orientation of 12.3% CET1 pre FRTB. I don’t have to remind you that our CET1 has showed little volatility through the cycle demonstrating a tight control of our trajectory. This on the back of our diversified business model enabling us to be less cyclical than many other banks. If we now turn to Slide 16, where you can see our progress on SRT. Since we started, we have a cumulative benefit of EUR44 billion on our risk weighted assets, equivalent to 65 basis points of common equity Tier one.

During the first half of this year, we implemented around 20 transactions for around €12,000,000,000 of gross RWA savings. We now expect more than 10 basis point benefit from optimization in 2025 and 2026. And so all this is within the current regulatory environment. If we move a second, looking forward to the Save and Invest Union SIU, it should support revenue growth in CIB via securitization services and increased ABS trading volumes as well as IPS through higher margin investment products, while of course also helping reduce our own BNP Paribas RWAs and improving BNP Paribas Common Equity Tier one ratio. Although it is too early to quantify the exact impact of SAU pending final regulatory details, we believe a successful implementation could add several tens of basis points to our ROT.

If with this, you can look at slides twenty and twenty one where we look at the strong track record of our CIB division reaching a record level in the second quarter. We also provided you with a focus on our Security Services businesses, which continues its fantastic journey of growth, both organic and through acquisition, including the recently announced acquisition of HSBC custody and depository activities in Germany. Security Services has expertise and scale and is a significant contributor to the ability of our CIB to produce revenues that are not volatile and show a steady growth through the cycle. Having talked about CIB, let’s turn to Slide twenty two, twenty three on CPBS. First, as we indicated last quarter, we are working hard to improve the divisions not delivering adequate returns and we demonstrated during our deep dives on personal finance and CPBS that the target in excess of 17% RoNE by twenty twenty one twenty twenty eight, sorry, will be reached.

As expected, you can see the start of a sharp acceleration of the net interest income in our commercial banks in the Eurozone, thanks to a stabilization of current accounts, as mentioned before and we expect further progress in the second half. If we now turn to Slide 24, 25 on IPS. This division will represent the biggest growth driver for the Group for the next few years and we welcome AXA I’m employees on our group on the July 1. The integration has been launched and we will provide you with synergies targets during our third quarter results. By year end, we aim for the legal merger of BNP Paribas Asset Management, AXA I’m and BNP Paribas Rhein and we will follow-up with a deep dive in the first quarter of twenty twenty six.

AXA I’m will enable us to have a greatly reinforced distribution network, a broader product range, a platform at scale, enable us to take full benefit of the Save and Invest Union, a core building block in our integrated business model of originate and distribute. So having given an update on the businesses, I’ll now hand it back to Jean Laurent for the conclusion.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas: Thank you, Lars. So to conclude on Slide 26, our second quarter performance is solid. We will distribute on September 30 an interim dividend for EUR 2.59 per share equivalent to 50% of our first half EPS. We see strong acceleration of our revenues and preferred before tax growth in H2, which would enable us to exceed EUR 12,200,000,000.0 of net profit. And we confirm our trajectory 2426 with all levels already in place.

Let me conclude by some final comments about the recent changes and the portions that we announced. The aim at consolidating the group’s integrated model by accelerating the market share growth of our CIB based on its originate to distribute approach, strengthening the cross functionality of the commercial banks in the Eurozone and preparing their future by focusing in particular on common technological investments. With acquisition of AXA I’m one of our largest external growth moves, we are consolidating the Group’s asset management businesses and accelerating the development of our IPS division in line with its insurance and wealth management businesses. We’re preparing BNP Paribas for the next phase of its growth. This concludes our presentation and we are now happy to answer your

Conference Operator: question, please press star one on your telephone keypad. Please lift your handset, ensure that the mute function on your telephone is switched off and that you are in a quiet area to maximize audio quality. I would like to remind you to please limit yourself to a maximum of two questions. We will take questions as many as time permits. Again, please press star First question is from Pierre Chedeville, CAC.

Pierre Chedeville, Analyst, CAC: Good afternoon. My first question relates to commercial banks in general. I was wondering why at the end of the day, there’s such a difference in terms of profitability between your European path and some other of your competitors? I was thinking, of course, of Italian banks. Of course, you can tell that comparison is not relevant.

But at this stage, this level of difference in profitability, I was wondering how do you intend, how do you think it’s possible to reduce this lag? And it’s not only a question in Italy, for instance, when I look at Belgium, where you have a big market share, your profitability is around 10%, which is not very, very high. So a general comment between these discrepancies between commercial banks in Europe? And my second question relates to asset management. If you could give us a little bit more color regarding your good inflows this quarter.

And particularly, I was wondering if it comes from retail or institutional customers. Is it long term products? And where are you about passive management this quarter? Thank you very much.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: Thank you, Pierre. Listen, when you look at the performance, the main objective that we have is to improve every single day. So if we look at B and L, for example, our priority is profitability improvement despite the challenging competitive environment. If you look, for example, at our internal metric, the Roni, which is close to 14% in the first half of the year, so nearly twice the level we saw in 2022. And so if you look at it, what are the levers that we use are the ones that are applicable for us in the environment there we are.

And so for B and L, it’s for example, the costs. Costs are down 1.5%. And even if this you include that the GGS has fallen off, that is what you basically see. And the same is true for the cost of risk, which was at 38 basis points. It has gone down to 30.

So that is the kind of things that you do. You see the same thing in France. In France, in the environment that we have, indeed, we have a yield, which is single digit. You have seen the deep dive that we have announced in order to produce it. So that’s basically what we do.

We adapt and the idea is to have the profitability to increase. So that’s on that one. When you look at Asset Management, so Asset Management, we have a setup to be diversified distributing on the retail and the institutional. And so that’s basically relatively stable. If you look at that, if you look at the overall inflow that we have in the second quarter, it is gravitating towards, as you’ve seen, 15,000,000,000 in the second quarter.

If you then look at basically what is it going into, it is flowing on one hand into monetary and on the other hand, on the medium term, longer term funds. So that’s a bit the trade off. And then over and above the flows, if you look at the top line, so the top line intrinsically is fine. I have to remind you that our asset management as we publish it, it also includes our real estate activities, which is intrinsically not part of the asset manager and that activity remains in retreat. And what we see is that even if the interest rates are going down, the investment volumes are still not materially picking up.

So that would be those two access, Pierre.

Pierre Chedeville, Analyst, CAC: Thank you.

Conference Operator: Next question is from Tariq El Majad, Bank of America.

Tariq El Majad, Analyst, Bank of America: Hi, good morning everyone. Thanks for taking my questions. Actually, mainly one on capital. Can you explain us what’s the rationale to move into a phased in basis versus fully loaded? You alluded to be consistent or compliant with the regulation, but can you elaborate on what’s the difference between the two?

Is it only the phased in of the output flow from 02/1930, or there is anything more to have in mind? And also, another question on capital. I mean, the sector is clearly moving towards higher level of CET1 targets of non Putin number, but clearly higher than 12%. And it’s been rewarded and seen as the new normal. I mean, you’ve been consistently repeating that managing the bank at 12% is ample and sufficient and adequate.

But don’t you think it will be forming kind of glass ceiling for your valuation? I mean, especially today, I think you had great numbers showing a strong recovery in most divisions, positive jaws in the cost, can’t really fault much in terms of earning recovery. I’ll be interested to hear your comment on this. And then linking to that on the SIU, you mentioned few tens of basis points of benefit from this. I understand you don’t want to be more specific at this stage, a lot of things are still in the making.

But I mean, are we talking something above 100 basis points or below? And maybe, actually, most interesting question would be to understand your conviction on if this project will come true, and if Europe will stick together to deliver actually something that will be applicable, especially the latest EU securitization framework had all the buzzwords, but unfortunately, I don’t think it went to the extent we were hoping in terms of relaxing the rules for allowing banks to securitize and invest and so on. Sorry for the long question, but we’re keen to hear your answers. Thank you.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: On your three questions. So let’s take the time. Let’s do the first one. So the first one on the metric. If you look at intrinsically the binding metric when it comes to calculating the MDA, so to ensure that you can pay dividends and the likes is the Phase I.

So that is the one that we apply. That is the one that counts. Secondly, if you then look at BNP Paribas, for us this phasing, it’s basically coming in two periods. There’s a phasing happening from now till two thousand and thirty, which is basically the floor. And then after that, there are the other effects that come in play.

For BNP Paribas, that first phase leading to 2,030 on the floor, it doesn’t bite. So for us, the difference between the fully loaded and the phased is zero. There is no difference. And then thereafter, it’s limited, it’s 10 basis points. And so moreover, what we see in the market is that the interpretation of this fully loaded, I don’t know how many definitions there are, it can be a bit fluffy.

And moreover, that is why ourselves and basically several of our competitors are moving in the phased approach. So intrinsically, is no difference. As I said, there is no difference till 2030 for us. It’s very minimal thereafter. We apply what is the metric that is needed to calculate the MDA.

And so that’s basically it. And so that is on the change. On the common equity Tier one, let’s put it this way. If you look at the requirements that is being asked to us intrinsically, And then that’s the pillar one. And then if you also look at the pillar two and you might get an update next week when the stress test is published, you see that of the large European banks, we basically have a pillar two, which is very low, which basically reflects our low capital requirement, which again reflects the view of the supervisor of our diversified setup and our impacts.

Even if you go back for a while, if you go back in the last ten years, our diversified setup never triggered a common equity Tier one reduction bar when Basel II, III came. But intrinsically, it is very stable. So that is why we see both from the supervisor, both from what we have in historic view that we fly at an appropriate level. When it comes to the Save and Invest Union, it is indeed a thing that should happen. Listen, I can tell you whatever kind of numbers.

Yes, I’m not going to make you dream. We just mentioned multiples of tens of basis points. But what you see is that Europe is putting the sales. So they have been talking about Save and Invest Union in February. They have added a complimentary on the securitization back in June.

And you might have seen that they are also working on evolving or allowing insurance companies to invest on a more equilibrium way into equities. So all of these effects are really supporting that the European Commission is setting all sales for it to improve, which is a positive thing. Now again, taking the time it takes, it’s going to take till 2028, till these things crystallize, right? But that is what we see.

Tariq El Majad, Analyst, Bank of America: Okay. Just a quick follow-up. I mean, on the 10 basis points cap, which is actually in eight years’ time, and would you be confident to actually mitigate the effects and even go beyond to convert the two? I mean, one bank report

Lars Machenil, Group Chief Financial Officer, BNP Paribas: Sorry, I’m not sure. Which 10 basis points are you talking about?

Tariq El Majad, Analyst, Bank of America: Sorry, the gap between phased in and fully loaded.

Alain Chris, Analyst, Goldman Sachs: Yes.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: Listen, as I said,

Flora Buchel, Analyst, Barclays: this is

Lars Machenil, Group Chief Financial Officer, BNP Paribas: coming basically down the road at once we the next phase comes in. And that next phase that comes in is basically, there are products that we have that are called, listen to my words, unconditionally cancelable commitments, unconditional cancelable conditions. However, Europe at this stage is basically saying that they will not be totally unconditionally uncancelable. And so that is what we see that has an impact of the 10 basis points that we talk about. So we’ll have to see if Europe comes along that basically that does not make sense or we will see how we can evolve those products or price those products alike.

So yes, I haven’t given up that we can compensate that.

Tariq El Majad, Analyst, Bank of America: Thank you very much. Very helpful.

Conference Operator: Next question is from Delphine Lee, JPMorgan. Yes, good afternoon. Thank you for

Delphine Lee, Analyst, JPMorgan: taking my questions. So my first one is on Eurozone, commercial and personal banking in the Eurozone. Just trying to understand if you’re confident of your path towards more than 3% considering the first half? Well, if you look at BNL, Belgium, the trends are still a bit challenging. So if you could maybe elaborate a little bit of what you do expect in the second half in terms of pickup for these two businesses?

And then my second question is on capital. Just double checking in terms of I’ve seen your 10 basis points that you would expect for the rest of the year coming from RWA optimization, securitization, SRT, I think? And just on the regulatory side, on model updates or anything like that, are we still having 10 basis points regular headwind for this year? And does that imply any reversal of what we’ve seen so far? Or if you could just clarify a little bit the CET1 path for us.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: Thank you, Delphine, for your question. So yes, indeed, we reiterate the above 3%. If you look at it, so as a reminder, given the fact that we have in France and Belgium, those mortgages, which are at fixed rate. So the kicking in of the reflection of the higher interest rates is taking time. So that is the pivot that we talked about that is happening.

So remind you, a quarter ago, we said that that pivot was happening and that the first one where we would see it is France. Look at the second quarter, you see it, it kicked in. You also see the pivot in Belgium. So that is why we say that there will definitely be above 3%. If indeed you look at B and L, what you see is that probably it will gravitate a bit below the 3%.

But given the overall setup, the other two will more than compensate. And so yes, we reconfirm to above 3% for our Commercial and Private Banking in Europe. So if you basically look at the impact on capital, so we’ve guided that there would be a full year of 10 basis points. And that is basically what you have seen. And so that is intrinsically what we anticipate to have for the year.

On the 10 basis points that we have in this second quarter, it’s a model update that if we adapt and have an evolution in our models that zero should taper off. But that tapering off will be in 2026, 2027. So that’s basically where we stand.

Delphine Lee, Analyst, JPMorgan: Thank you very much.

Conference Operator: Next question is from Joseph Dickerson, Jefferies.

Joseph Dickerson, Analyst, Jefferies: Hi. Just kind of on the same theme. Just in Italy,

Lars Machenil, Group Chief Financial Officer, BNP Paribas: can you

Joseph Dickerson, Analyst, Jefferies: discuss on structure of the loans? Are they fixed? Is it swapped? I was a little surprised at the decline in the margin in Italy. But more broadly, I guess, how much now of the H2 twenty twenty five revenue performance is effectively locked in now due to mortgage repricing, deposit mix and replicating portfolio?

Thanks.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas: So if you look at Italy, if you look at the the retail side within Italy, BNL, this is a fixed rate mortgages type of balance sheet. So it’s very different from the average regular situation you would have in in Italy. So this is first the the the pressure today is coming from the, let’s say, the the more corporate banking business within BNL. There’s a lot of pressure on lending. So so margins are under pressure.

So this is basically the the the driver for the the top line within BNL. But if you look closely for us, the point with BNL is not volumes or size, it’s just profitability. And remember that this quarter, the pretax profit for BNL is up by more than 30%. So BNL is looked at for the profitability. We need to continue to do the ramp up that progressing well.

And this is the story with BNL. And clearly today within the Italian market, there are some pressures on corporate banking that is, I would say stronger than before. Then if you look at the second half, we tend to say that most of the rebound is already plugged within the ALM, Belgium, France, Italy, the fact that the base effect from Arval is just vanishing in the air. So it’s a very, very mechanical effect. This is going to happen.

This is already in the book to some extent, and it will go down directly to the bottom line because there is no cost base I would say, associated with that. There is no cost of risk, of course, associated with that. So the rebound in the top line is most of it plugged into the balance sheet and it will become directly a pretax profit that will drive this very strong rebound in the second half. And you will be probably surprised by Belgium and France as well. So this is the story.

And again, we’re getting rid of most of the best effect with Arval. So this is the story and only low looking at IPS and CIB, they’re going to evolve like the first half. So at a good strong level, but the rebounds coming much of it coming from the Eurozone banks. And the fact that Arval is now big, I would say free of the BaZ effect.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: Perfect. Thank you.

Conference Operator: Next question is from Giulia Agoramiotto, Morgan Stanley.

Giulia Agoramiotto, Analyst, Morgan Stanley: Hi, good afternoon. Thank you for taking my questions. The first one, can I go back to Slide 16 where you showed these tens of basis points of ROTE benefit on SIU? What exactly do you include as SIU? Because so far we only got a text on securitization, which I think can still change.

I would hope that the industry lobby can improve it, but then we could get some other stuff on pensions, on investments. What are you assuming here and what do you expect we get essentially on the other legs of the SIU? That’s my first question. And then the second question on the investment bank. Your FICC number were exceptional whereas the equity numbers were a bit weaker than peers.

Is there anything that you want to call out there and have the trends continued into Q3? Thank you.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas: Well, if you look at CIB, I mean, it’s always the same story. The the equity business had been prepared by is very different from the one you can have with US banks. US banks are much more kind of business type of business. So last year, the structure of the market was very much in favor of the kind of BNP Paribas type of business model for equities. This year is the reverse way.

So, don’t forget that in two years’ time, we consolidated more than 30% growth within equities. So it went up by, I remember well, by 34%. So this is huge. So, and again, those businesses are slightly volatile and they are very different structurally from The US classical type of equity businesses. The FIC universe is, as you may know, the characteristic of the diversification of global market had been ppibat.

It happens quite often than either one of the two drivers are evolving in a reverse way. It’s not that frequent that a certain quarter, both are very strong at the same speed. So it gives diversification and stability. And once again, if you look at the global market, this is best quarter ever we got. So once again, stability, diversification, continuous progress, market share growth with a very different business model looking at equities compared to The US banks.

So this is for CIB.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: Yes. Listen, Julia on SIU, let’s be fair. As you mentioned at the SIU, what is on the table for the moment remains a bit vague. But if you look at the access that Europe puts in motion, so they put access in motion, which is what they published in June, it’s to step up securitization so that banks can offload more. So this is things like parameters that you use in the capital calculation, the criteria that you include and so forth.

That’s on one hand. So that’s allowing the offload. And then secondly, there is also efforts that are being done to have more investment capacity. And that is what has been we have seen this week, where there are reflections on how to evolve the Solvency II to allow in which is a bit penalizing for the moment for insurers in order to invest into equity products. Because as you know, in Europe, typically, your average individual does not go for individual tickets as he might do on the other side of The Atlantic.

So he need insurance wrappers to basically do it, which are Solvency II is a bit detrimental for it. You see that Europe is also working on making those parts of the aspects better. So you see several acts being put in motion. But again, it will take a bit of time for it to land, but the direction is there.

Giulia Agoramiotto, Analyst, Morgan Stanley: Thanks.

Conference Operator: Next question is from Andrew Combs, Citi.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas0: Two questions, please. Firstly, just a follow-up on CDBS. If I look at your net interest income rebound this quarter and if I look at the abrupt shift in deposit mix and the growth that you’ve seen in site deposits, I’d imagine that experience that you’ve seen in the quarter is somewhat better than you expected. I mean, certainly, it’s better than your assumption for the full year with stable deposits and stable mix of deposits. So you provide the sensitivity help me on the slide, but is there any reason why you’re not increasing the greater than 3% revenue guidance?

Is there offset elsewhere that we should better understand? That’s the first question. Second question, just a technical one, on the insurance business, you’ve had two consecutive quarters of revaluations of stakes this time in China. What’s your process for doing the reval on those stakes? And any more that we should be thinking about?

Thank you.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: Thank you, Andrew, for your questions. Listen, on CPBS, you’re absolutely right. So the deposit mix is intrinsically a tad better than what we had anticipated. But that is why, listen, we don’t give an update every week as passes by. That’s why we said that the top line growth will be above 3%.

It’s the same thing with the EUR 12,200,000,000.0 profit. We said it will be above EUR 12,200,000,000.0. I let you do what your estimate is, but I do confirm that the deposit mix at this stage is better than what we had initially taken up. On the revaluation, so indeed, if you look at our activities that we have, one of the levers that our insurance had to grow is they have that technical skill. They bring that technical skill by having distribution within BNP Paribas, distribution to other banks and partners with other players.

And so what can happen when you look at several of these players, you take them in your balance sheet to equity stake because you don’t have a consolidation effect. And then it can be that in one quarter or another, there is an exceptional dividend or there is a review of the accounting norms. And so these are the things that can happen. These are exceptional kind of elements, one off elements that we mentioned that there is not more to read into it.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas0: Thank you.

Conference Operator: Next question is from Stefan Stallmann, Autonomous Research.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas1: Yes, good afternoon. Thank you very much for taking my questions. I would like to start with a relatively high level question about the economic environment and in particular corporates. You mentioned a challenging environment and that corporates are holding back because of tariff uncertainty. At the same time, your big German competitor has given a very bullish view on the corporate landscape that they are seeing in

Lars Machenil, Group Chief Financial Officer, BNP Paribas: the

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas1: prospects, everyone looking at fiscal stimulus spending, etcetera. And I was wondering if you see the same, let’s say, difference in optimism between German corporates and the rest of Europe or whether you see any spillover of this apparent German optimism into markets like France, Belgium, and Poland or whether that has simply not arrived yet? And the second question goes back to the equities business. I don’t think that you disclosed the split of your equities business by cash derivatives and prime at the deep dive. Maybe you did and please correct me if I’m wrong.

But if you didn’t maybe could you give us a rough sense of how that splits? I do remember though that at the time you gave a split by basically client segments where you had substantially less exposure than the Street in particular to I guess hedge funds alternative investment managers. Do you think that was a major reason why you had so much less momentum in your equity business than The U. S. Peers?

Thank you.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: Stefan, thank your you questions. If I look at the economic environment, what we have in our outlook, which is reflected in what we assume for GDP growth, in what we assume in our adverse scenarios taking into account in the cost of risk is that basically the elements that could be weighing that have been a bit wait and see is that uncertainty on tariffs. But we anticipate that, that uncertainty will disappear. That uncertainty disappearance will come with some tariffs. So let’s assume that in our central scenario, we have like 15% of tariffs, and that is what we reflect in the economy.

And you can see that we anticipate European wide, we anticipate a GDP growth. That is what we see. That is what we anticipate. And it’s a bit different between countries. But intrinsically, overall, in Europe, that is the growth we see.

We have this again, with those tariffs uncertainty coming to an end, we see a pickup all over Europe. And then on your equity, if you look at it, the spread between the three is, if you wish, fortyforty roughly, right, fortyfortytwenty. But if you look at the what is basically the impact. So there’s two, if you look at the results, first of all, our results in Equity and Prime Services, if you look at the first six months, it’s a record level. So that’s the first thing you would need to do.

Now if you compare the second quarter, there’s two ways you can compare it. You compare it within BNP Paribas itself. And then if you go back to a year ago, remember in June, there was a lot of uncertainty ending in particularly in France in the middle of month. And so that basically meant that there was a double demand of program. Everything which was taken as an orientation at June had to be moved in the second half.

So the demand was very high. And so that is what we saw in a very steep evolution. So that is the reason. So overall record level. However, if you compare it to the second quarter, which was impacted by this special environment.

And the second thing, if you compare it with The U. S, if you compare the quarter. So what we are mainly doing, if you look in Europe, one of the key things that we are having is the structured notes and all of these services around it less flow. Whereas in The U. S, if you look now, the flow, which was rather reduced a year ago, really stepped up this year.

And so we also participated in that growing flow within The U. S. But of course our European activities are more dominant in activity versus the other one. So that’s the two things. So record level in the first half, if you compare the second quarter with ourselves, second quarter, given the uncertainty that we had a year ago, there was like all stars were aligned, the demands were very high.

And if you compare with The U. S, it was more flow whereas the elements were that. And if you look at it, the important thing, if you look at how we have those records and why we keep on taking more market share, if you look at the kind of clients, if you take the equity space, so equity and prime services. So there’s basically three products. There’s cash, there’s derivatives, there’s prime.

And if you take those three products and then you look at the top 100 institutional clients. In the past, we said that and when you were at the deep dive, saw that we had like 52 of the 100 institutional took those three products. Today, we are at 63 of those institutional clients taking the three products. So that is what we keep on doing. So we keep on taking market share record level in this semester.

And then those two axis of differences when you compare in the second quarter. Stephane, those would be my two answers.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas1: Lastly, maybe just quickly clarify when you said 40,000,000 40,000,000 20,000,000 was the $20,000,000

Lars Machenil, Group Chief Financial Officer, BNP Paribas: the cash portion? Yes.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas1: Thank you. Great.

Conference Operator: Next question is from Alain Chris, Goldman Sachs.

Alain Chris, Analyst, Goldman Sachs: Yes. Hi. Good afternoon, everybody. So this is just a follow-up, guess, the first one from Stefan’s question just now. But looking forward, I get what you’ve said about the difficulty versus the comp last year.

But if we use this quarter now, is that a logical comp to look going forward when we think about year over year growth in 2026 or maybe the sequential evolution Q3 versus Q2? Just is there anything in this quarter that we should also keep in mind? And then secondly, staying in EPS in prime, you mentioned brokerage balances held up well. Is that a comment in euros or in local currency? Because I guess you’re absorbing sizable FX headwinds there.

And some of your peers, maybe you don’t have that headwind, have talked about growth imbalances. So just maybe a comment on the sort of organic versus headline evolution of those balances versus competition. Thank you.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: Yes. Thank you, Chris. So just could you rephrase quickly your first question?

Alain Chris, Analyst, Goldman Sachs: Yes. Basically, are there any one offs in EPS in Q2? So when we have the call this time next year, whether we need to be thinking about the comp at all?

Lars Machenil, Group Chief Financial Officer, BNP Paribas: No. If you look at EPS, if you look at the evolutions, again, the best metric what I can give is indeed we have record levels. And those record levels come from the fact that there was still volatility, right? I mean, what we had on the Liberation Day. So the story, if you look at the volumes that were done and then that we gradually step up our market share.

So from that point of view, we have been able to step up market share. And so we have been taking more than our part every time, bit more than the volume. So it’s always the same question. So we will continue that. What will be the overall demand that is happening?

Typically in the third quarter, it’s a tad less than in the second quarter. So but we keep on stepping up. That’s basically the story of CIB. We step up our market share. When you look at the prime brokerage, so if you look at the consumption of the scarce resource, if I can say on prime brokerage, it’s not capital, right?

Because everything is hedged, that’s limited. So it is balance sheet. So it’s balance sheet, pure balance sheet or leverage. So the exposure used in the leverage ratio. So the one which is most talking, I guess, is the balance sheet by itself.

And so what you see is typically that is expressed in dollars. So for us, we are at the record level and we are at the record level of $500,000,000,000 in exposure.

Alain Chris, Analyst, Goldman Sachs: Okay, thank you.

Conference Operator: Next question is from Anke Reingen, RBC.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas2: Yeah, thank you for taking my questions. I just wanted to ask firstly, about the at least EUR 12,200,000,000.0. I mean, you stressed a number of times that’s at least, but I just wondered in terms of the second half versus first half, I would have to see sort of like a step down versus the 6,200,000,000.0.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: I could I’m not sure I can hear you very well. Can you re rephrase your question?

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas2: I tried to speak a bit louder if that helps, but please let me know. So on the €12,200,000,000 you stressed it’s an at least target. But what should we think about as the potential headwinds? Because I guess it looks a bit of a step down versus the first half. And so far, you mainly talked about the tailwinds.

So I guess there’s a cost seasonality, investment banking seasonality. And just to confirm, the EUR 12,200,000,000.0 includes a contribution from AXA. And can we use on Slide five the bars as sort of like an indication of what you could have penciled in? And then secondly, on the jaws CIB, the 3% cost growth, is it also because last year, the costs were a bit lower? Would you think this year you managed the cost?

I mean, obviously, it depends on the revenues, but there will be less of a volatile you you think you manage across best better in CIB rather than having a q four step up? Thank you.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas: So for the the yearly guidance, so we said a minimum of 12.2. This is already with some headwinds included. So we have to some extent room to maneuver. And, yes, it includes the the extra net, of course, of some restructuring costs also. It’s the situation.

So, we would tend to say that the 12.2 is a minimum and factored in a quite cautious way.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: On the cost base and the jaws at CIB, as you know, we operate at marginal cost. So, at CIB, when you have more revenues, you basically have more variable costs. Now from time to time, there are also some investments we have to do that comes with whatever regulatory and other kind of investments we have to do. Now on top of that, we have to take into account, which is a bit perturbing in it, but you have to take into account to explain some of the volatility is that we have the revenues that are generated in dollars, for example. If you see the costs that come with it, part of them are dollar based, but part are European based.

And so the effect of the dollar on the jaws also plays into this. So that’s a bit it. There is nothing you should read into it. We go for operating jaws. Sometimes it can be a bit different for the two reasons that I just mentioned, Tanq.

But we are very focused on costs. Don’t get me wrong.

Conference Operator: Thank you. Next question is from Farad Kumar, Deutsche Bank.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas3: Good afternoon. Thank you for taking my questions. I have a couple. So firstly, on asset management, can you help us understand the moving parts of revenues in more detail? I note revenues were down sequentially despite the Q on Q rise in AUM.

Maybe can you break down the impacts between FX impact, fee margin pressure? Also on real estate, is it possible to quantify? And maybe how far is it from the recurring rate? And when do you think it can go back to those levels? That is on asset management.

Second one is on r one. I note your comments about, r one being freed up from base effects. My question is on the sustainability of the organic fleet growth, which is trending above your main peer. So do you think this level of growth is sustainable? Or other way is, if fleet growth slows, do you think this can be compensated by higher leasing and service margins?

Thank you.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: So thank you for your questions. When you look at asset management, indeed asset management, you should be aware that within the division that we call asset management, is also real estate. And now we I know, but we don’t give these activities, but I can give you color. So that activity on real estate, even if rates are lower, has not in the areas where we are have not picked up. And so the contribution of it remains negative.

Let’s put it this way. It has a negative contribution this quarter. So then if you look at asset management and this should be back towards the end of twenty twenty six, 2027 that should turn around. Then if you look at asset management, within asset management, there are indeed several effects. The negative market effects that we have is indeed the market and the Forex effect on the fees.

So the fees are driven by that. Well, there is a Forex effect that we mentioned. So whatever is in dollars get translated and the same is on the market that happens. Moreover, Asset Management, on top of that, we do have a participation, for example, in and coming from co investment funds that we have. And also, they are impacted by that and they have a lower contribution.

So that’s a bit where we stand. That’s the things that weigh a bit on this quarter, but that should normally iron out going forward with both the market and the ForEx effects stabilizing. And indeed, if you look at ARVAL, so whatever what we see with the setup that we have, we confirm in what we see that we have more than 10% inorganic growth. So if we discard for a second the resale value, if we look at the growth, both in the growth of the financing of the cars and the servicing that we charge, we are clearly on track to deliver 10% growth in 2025. So that will be my answers.

Conference Operator: Next question is from Flora Buchel, Barclays.

Flora Buchel, Analyst, Barclays: Yes, thank you. The first question I’d like to ask you is on asset sales, simply whether this is something that you would consider rethinking also some of your business mix without giving us names or divisions obviously on this, but just simply, is this something that could happen? And what would be the considerations for that to happen? And the second question is on the recent changes that you have announced on the governance, which I think are ahead of your next business plan and also in light of the SIU. I didn’t see Europe Med mentioned in there.

So I was just wondering how Europe Med fits in your strategy into the next plan. Thank you.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas: So I guess this is the same question. Asset disposals on Europed. So we are continuously monitoring all businesses, even within businesses, pieces of a certain business. Looking at the past five, eight years, we we did a lot. Potentially, can still continue to move in a number of situations.

Honestly, we have no situation that, I would say, non noncore. I mean, most of the businesses we’re having are core to the to the company. Of course, you you can have some some pieces that are slightly not 100% core, but this is very different from the situation we’re having, let’s say, five years, seven years, eight years ago. So we’re monitoring. Sometimes we’re we’re offered to to exit some some situation, and the the the key the key point is about the the price you are being offered.

So there is no no need for us to move, but you never know. So sometimes someone can be better positioned than us to run a certain business. So so it’s the this is the rule of the game. Governance, I mean, for for CIB, it’s it’s it’s going to be a different organization. It’s going to be very much aligned with this idea of origin to distribute, not anymore to measure blocks, one being global market and one being the, let’s say, the corporate bank.

It has to be totally integrated. So it’s going to be much more much more efficient with less capital consumptive type of approach. And looking at the commercial bank within the Eurozone, one of the major issue is to deliver a common approach in terms in investing in technology, digital apps, and so on and so on. We need to go one step further. We had a lot of cross synergies in between those different countries, these different, let’s say markets, but we need to go even further in terms of integrating those businesses in terms on how you invest the cash flow of those businesses.

And we need to invest that in a very much disciplined way. So we can leverage the same way a certain Euro invested in technology for the benefit of the different local markets. So fact that we are going to have one person in charge of this perimeter is going to help and to deliver that discipline. There’s nothing new, but it’s going to be much more, I would say, that way. And we can probably extract some and even a lot more profitability for such a kind of an approach.

We need, especially looking at, I would say personal individuals, we need to deliver something that is more, I would say common to the platforms and not every time just delivered in a slightly different way in the different banks. So this is one of the issue. And of course, this will help also integrating those markets within, I would say, the global group, CIB, IPS, asset management, and so on and so on. So once again, these little changes are not that little in fact. For CIB, it’s going to be one step further in terms of aligning the business model with the prospect of Virgin to distribute and Eurozone Commercial Bank trying to behave as one bank and not four or five different banks with investments that are going to be repeated one after another, but just one for the sake of the whole Eurozone region to put it that way in a very simple approach.

And we need to do that before, of course, the next strategic plan is going to be looked at in more details next year, starting in ’26, beginning of twenty six, and we will announce that new term plan beginning of twenty seven. So so we need to look at that very closely so we can deliver the the best numbers looking at the the targets under. Clearly, of the key element is going to be the return on tangible equity. There’s a lot to come. We already said that those, I would say, programs that are already disclosed, AXA I’m French commercial bank, personal finance, and so on are going to provide with 1% of return on tangible equity on top of the 12% in ’26.

But we can do better if we look at the situation in a more integrated way. And this is very much the focus of the next plan to extract more value from an higher integrated model. And of course, probably dropping some businesses that could became in that game slightly less core as someone said before. So, well, this is the rule of the game.

Flora Buchel, Analyst, Barclays: Thank you.

Jean Laurent Bonaffet, Group Chief Executive Officer, BNP Paribas: So that was the last question? Yes. Okay. So thank you. Thank you so much for your time.

So once again, as you can see, we are very much on track looking at the the trajectory we were announced beginning of that year, and you can very much count on us in terms of delivery. You will see the, I would say, the second half the impact of what has been, I would say, already organized, prepared. And the 12,200,000,000.0 is, as we said, the minimum. And next year is going to be an even better year. And rapidly will be ’27 with this new term plan.

And this is the story of the company. Thank you so much.

Lars Machenil, Group Chief Financial Officer, BNP Paribas: Thank you.

Conference Operator: Ladies and gentlemen, this concludes the call of BNP Paribas second quarter twenty twenty five results. Thank you for participating. You may now disconnect.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.