PARIS: BNP Paribas , France's largest listed bank, will not follow several rivals in cutting thousands of jobs, Chief Executive Baudoin Prot said, adding that costs were under control despite a challenging trading backdrop.
Prot said the bank had not bulked up excessively after the financial crisis, helping it avoid the thousands of redundancies announced at rivals such as Credit Suisse and UBS.
Britain's HSBC shocked on Monday when it announced 30,000 job cuts
"We didn't go for the go-go hires peers did in the last few quarters. If we didn't go for the go we didn't have to go for the stop," Prot told Reuters Insider in an interview.
Prot said the bank's second-quarter results, unveiled on Tuesday, were strong despite falling short of analyst expectations, pointing to a charge related to Greece as the main foil.
This 534 million euro provision from its exposure to Greek sovereign bonds was likely to be a one-off occurrence, Prot added, saying he was still confident that loan loss provisions would continue to fall this year.
He added the cost of risk was starting to come down in Italy and the United States, where the bank operates retail networks.
Worries have been mounting over Italy's ability to manage its sovereign debt burden as the spectre of a bailout looms over several Southern European countries, but Prot said it would likely weather the storm.
"I expect the Italian economy, in terms of its debt and fiscal discipline, to implement the plan that was recently voted by parliament. Behind the present turbulent, Italy will manage well," Prot said, adding that profitability at its retail division there would continue to improve.
BNP Paribas also has a big exposure to Italian sovereign bonds.
Prot said he was confident that the bank would not have to raise further capital after its core Tier 1 ratio came in at 9.6 percent in the second quarter, up from 8.4 percent a year ago.
He said the French bank was "not very acquisitive", and was focusing on growing its businesses organically.
Copyright Reuters, 2011
Comments
Comments are closed.