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November 06, 2008
BNP Paribas, France's largest bank, said today that profits fell by more than half in the third quarter, following the collapse of Lehman Brothers and the worsening financial crisis. Shares in the bank fell by more than 3 per cent today after it said that net income declined to €901 million (£728 million) from €2.03 billion a year earlier.
BNP Paribas had appeared to have escaped the worst of the financial crisis and had acquired the Belgian operations of Fortis, but it was unable to evade the impact of Lehman's bankruptcy and the collapse of the Icelandic banks. The bank said its earnings for the July-September quarter were affected by “numerous critical situations in the financial services industry and unprecedented turbulence in the markets since early September
The collapse of Lehman and the big Icelandic banks contributed to write downs of €1.1 billion. Profit before tax at BNP Paribas's investment bank fell from €760 million a year before to to €38 million. The division, which increased revenue by 4.6 per cent, had €1.03 billion of loan provisions and €289 million of asset write downs.
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