BNP Paribas plans big China push amid challenges

 

BNP Paribas will find it difficult to meet a promise to match last year's investment banking revenues in part due to worsening market volatility, Chief Executive Baudouin Prot said on Tuesday.

 

Market volatility worsened in March and created a "very adverse trading environment", Prot told a news conference.

 

"In this context, we still stick to our target to try to repeat last year's record revenues," he said, referring to the bank's corporate investment banking unit.

 

"But I can only tell that it is becoming more and more challenging to try to repeat these revenues, and visibility is limited for the remainder of 2008."

 

BNP shares were down 2 per cent at €68.77 by 0830 GMT, in line with a 1.7 per cent fall in the DJ Stoxx bank index.

 

BNP said in February after its fourth-quarter earnings that in 2008, it aimed to have its corporate investment banking arm match last year's record revenues.

 

BNP gave a confident 2008 outlook after the quarter despite posting lower profits. Compared to some of its peers, the bank suffered a relatively small hit to earnings from its exposure to subprime mortgages.

 

Prot, in Hong Kong on Tuesday to celebrate BNP Paribas's 50th anniversary in the territory, said "greater China is a high priority" and outlined the bank's plans there.

 

BNP Paribas aims to triple its China revenues in the next three years and plans to double its share of emerging market revenue in the same period.

 

BNP hopes to double its China headcount to more than 600 and plans to double emerging market revenues to reach 15 per cent in three years. (Reuters)