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1. Company Snapshot

1.a. Company Description

BNP Paribas SA provides a range of banking and financial services in Europe, North America, Asia Pacific, and internationally.The company offers corporate and institutional banking services, such as consulting, financing and transaction banking for corporate clients and institutional investors; capital markets investment and financing; securities clearing, and custody services.It also provides commercial, and personal banking and services, including financing and leasing services, financing of individuals, and digital banking services, as well as current and savings account products, equipment leasing and financing solutions, and consumer loans.


In addition, the company offers investment and protection services, which includes borrowers' insurance, which protects the insured party from the unexpected when taking out a mortgage, personal, auto, or consumer loan; savings and protection solutions comprising life insurance, employee savings, retirement savings, etc.; asset management, wealth management, and real estate services.The company was formerly known as Banque Nationale de Paris and changed its name to BNP Paribas SA in May 2000.BNP Paribas SA was founded in 1822 and is headquartered in Paris, France.

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1.b. Last Insights on BNP

BNP Paribas' recent momentum is driven by its upgraded capital target and new share buyback program. The bank raised its CET1 ratio target to 13% by 2027, driven by stronger profitability, moderate growth in risk-weighted assets, and disposal of non-strategic assets. A €1.15 billion buyback program has been authorized, enhancing shareholder value. Additionally, the bank's strategic international expansion and new sustainability initiatives have garnered investor attention. Its growth and risk profile continue to appeal to investors.

1.c. Company Highlights

2. BNP Paribas' Q2 2025 Earnings: A Strong Performance

BNP Paribas reported a strong Q2 2025 financial performance, with revenues rising 2.5% to a significant level, driven by a 4% increase in Corporate and Investment Banking (CIB) despite a high base in Q2 '24 and USD weakness. The bank's EPS came out at €5.2, beating estimates of €2.66. The net profit is expected to exceed €12.2 billion for 2025, driven by accelerating Net Interest Income (NII) in Eurozone commercial banks and Personal Finance.

Publication Date: Jul -27

📋 Highlights
  • Revenue Growth: Q2 2025 revenues rose 2.5% to a strong level, with CIB up 4% despite USD weakness.
  • CIB Performance: CIB delivered a record Q2, up 4% year-on-year, driven by Global Banking, Global Markets, and Securities Services.
  • Cost Savings: The bank is on track to deliver EUR 600 million in cost savings for 2025, with EUR 190 million implemented in Q2.
  • AXA IM Integration: The acquisition of AXA IM is expected to consolidate asset management businesses and accelerate IPS growth.
  • Future Growth: The bank targets a return on tangible equity of 11.5% in 2025 and 12% in 2026, with a new strategic plan to be announced in 2027.

Revenue Growth and Segment Performance

CIB had a record Q2, up 4% year-on-year, driven by Global Banking, Global Markets, and Securities Services. Commercial and Personal Banking (CPBS) revenues rose 0.4%, with commercial banks up 5% and Eurozone banks growing 1.2%. Insurance and Wealth Management drove a 4.4% growth in IPS revenues. As Lars Machenil noted, "the jaws effect is positive at 1.7 points, and cost discipline is paying off."

Cost Savings and Capital Position

The bank is on track to deliver €600 million cost savings in 2025, with €190 million implemented in Q2. The CET1 ratio is stable at 12.5%, indicating a strong capital position. The bank expects a sharp acceleration in H2 '25, driven by NII growth and cost savings.

Valuation and Dividend Yield

BNP Paribas' current P/TBV ratio is around 0.7, which is relatively low compared to its peers. The dividend yield stands at 6.07%, making it an attractive option for income investors. With a ROE of 7.05%, the bank is generating decent returns on equity.

Outlook and Strategic Plans

The bank expects to exceed its €12.2 billion net profit target for 2025 and is confident in its '24-'26 trajectory. The acquisition of AXA IM is expected to consolidate the group's asset management businesses and accelerate the development of the IPS division. BNP Paribas is working to improve returns in divisions not delivering adequate returns, such as Personal Finance.

Guidance and Future Expectations

Analysts estimate next year's revenue growth at 5.9%. The bank's guidance suggests a return on tangible equity of 11.5% in '25 and 12% in '26. With a new strategic plan to be announced in '27, BNP Paribas is poised for further growth and improved returns.

3. NewsRoom

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BNP Paribas (ENXTPA:BNP): Assessing Valuation After a Strong 1‑Month Share Price Run

Dec -05

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Crypto Weekly: American Bitcoin's bumpy week, Binance's new co-CEO

Dec -04

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10 EU Banks Unite to Launch Euro Stablecoin by 2026

Dec -03

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BNP Paribas Notes eBay’s (EBAY) Key Role in Online Marketplace

Dec -03

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BNP Paribas Joins EU Bank Stablecoin Venture Helmed by Ex-Coinbase Germany Exec

Dec -02

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10 European Banks Form Stablecoin Company qivalis

Dec -02

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European banks led by BNP, ING push ahead on euro stablecoin plan

Dec -02

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European Enterprises Strive for AI Innovation and Compliance, ISG Says

Dec -02

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.40%)

6. Segments

Corporate and Institutional Banking

Expected Growth: 5.5%

The segment's global presence and diversified client base position it for steady growth, slightly above the global average, driven by increasing demand for corporate financing and advisory services. The growth is also supported by the ongoing expansion of global trade and economic activity.

Commercial, Personal Banking & Services - Commercial & Personal Banking in The Eurozone

Expected Growth: 5.3%

The segment's growth is supported by the gradual economic recovery in the Eurozone, with increasing consumer spending and business investment. However, the growth is slightly below the global average due to the mature nature of the market and potential competition from other banks.

Commercial, Personal Banking & Services - Specialised Businesses

Expected Growth: 5.7%

The segment's growth is driven by the increasing demand for specialized banking services in niche markets. The segment's diversified portfolio and strong presence in these markets position it for above-average growth, supported by the ongoing expansion of specific business sectors.

Commercial, Personal Banking & Services - Europe-Mediterranean

Expected Growth: 5.4%

The segment's growth is supported by the economic growth in the Europe-Mediterranean region, with increasing consumer spending and business investment. The growth is in line with the global average, driven by the diversified market and strong presence.

Investment & Protection Services

Expected Growth: 5.8%

The segment's growth is driven by the increasing demand for investment and protection services, supported by the ongoing expansion of the global asset management market. The segment's diversified product offering and strong presence position it for above-average growth.

Other Activities - Excl. Restatement Related to Insurance Activities

Expected Growth: 5.2%

The segment's growth is supported by the overall performance of BNP Paribas' other business activities. The growth is slightly below the global average due to the non-core nature of these activities and potential variability in their performance.

Other Activities - Restatement Related to Insurance Activities

Expected Growth: 5.4%

The segment's growth is in line with the global average, driven by the ongoing adjustments and restatements related to insurance activities. The growth is supported by the group's overall insurance business performance.

7. Detailed Products

Corporate Banking

BNP Paribas provides corporate banking services to large corporations, including cash management, trade finance, and risk management solutions.

Investment Banking

BNP Paribas offers investment banking services, including advisory, equity and debt capital markets, and leveraged finance.

Markets

BNP Paribas provides market-making and trading services in fixed income, currencies, commodities, and equities.

Wealth Management

BNP Paribas offers wealth management services, including investment advice, portfolio management, and estate planning.

Retail Banking

BNP Paribas provides retail banking services, including consumer loans, credit cards, and deposit accounts.

Insurance

BNP Paribas offers insurance products, including life insurance, non-life insurance, and asset management.

Asset Management

BNP Paribas provides asset management services, including investment management and advisory services.

8. BNP Paribas SA's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for BNP Paribas SA is moderate, as customers have various alternatives for banking and financial services.

Bargaining Power Of Customers

The bargaining power of customers is low, as BNP Paribas SA has a large customer base and offers a wide range of financial services, making it difficult for individual customers to negotiate prices.

Bargaining Power Of Suppliers

The bargaining power of suppliers is moderate, as BNP Paribas SA relies on various suppliers for technology, infrastructure, and other services, but has some negotiating power due to its large scale.

Threat Of New Entrants

The threat of new entrants is low, as entering the banking and financial services industry requires significant capital, regulatory approvals, and a strong brand reputation, making it difficult for new entrants to compete with established players like BNP Paribas SA.

Intensity Of Rivalry

The intensity of rivalry is high, as BNP Paribas SA operates in a highly competitive industry with many established players, and must constantly innovate and improve its services to maintain market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 84.48%
Debt Cost 3.95%
Equity Weight 15.52%
Equity Cost 11.97%
WACC 5.19%
Leverage 544.23%

11. Quality Control: BNP Paribas SA passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Value: 5.8

Growth: 6.6

Quality: 7.4

Yield: 8.1

Momentum: 10.0

Volatility: 7.0

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SEB

A-Score: 7.0/10

Value: 5.6

Growth: 5.4

Quality: 5.6

Yield: 8.1

Momentum: 8.0

Volatility: 9.3

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Intesa Sanpaolo

A-Score: 6.9/10

Value: 6.2

Growth: 4.6

Quality: 5.7

Yield: 9.4

Momentum: 8.5

Volatility: 7.3

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BNP Paribas

A-Score: 6.3/10

Value: 7.6

Growth: 3.4

Quality: 3.9

Yield: 8.8

Momentum: 7.5

Volatility: 6.7

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A-Score: 6.3/10

Value: 9.2

Growth: 4.2

Quality: 5.5

Yield: 4.4

Momentum: 10.0

Volatility: 4.3

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A-Score: 5.4/10

Value: 7.0

Growth: 4.4

Quality: 5.1

Yield: 2.5

Momentum: 10.0

Volatility: 3.3

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

75.39$

Current Price

75.39$

Potential

-0.00%

Expected Cash-Flows