PARIS - B.N.P. Paribas, the largest French bank, said on Wednesday that its net income more than doubled in the third quarter, lifted by a strong performance in its investment banking unit, and that it had reached its capital adequacy targets ahead of schedule.
The bank's net profit rose to 1.3 billion euros, or $1.7 billion, in the three months through Sept. 30, compared to 541 million euros in the same period a year earlier. The firm's corporate and investment banking unit posted pretax profit of 732 million euros, up 7.3 percent, as both the fixed-income and equity and advisory segments performed well.
The bank noted that results were flattered by the comparison to the year-earlier period, when the sovereign debt crisis in Greece and other countries had a significant impact on European banks' earnings, as American money market funds reduced loans to the region.
B.N.P. Paribas and its rivals have since worked to secure their balance sheets by selling do llar-funded assets and cutting exposure to euro zone countries that the market considered to be risky. The French firm's corporate and investment bank division cut its risk-weighted assets by 45 billion euros, compared with the third quarter of 2011.
Aggressive action by the European Central Bank, which has promised to purchase bonds to hold down euro zone governments' borrowing costs, has also helped to restore a relative sense of calm to the euro zone.
B.N.P. Paribas said that at the end of September it had a 9.5 percent Basel III common equity Tier 1 ratio, a measure of a lender's ability to weather financial shocks, taking it above its 9 percent target. The figure puts the French bank ahead of many of its global peers.
Jean-Laurent Bonnafé, the bank's chief executive, said the results showed the bank's “resilience in a challenging economic environment,†adding that B.N.P. Paribas was now “one of the best-capitalized amongst the leading global ban ks.â€
B.N.P. Paribas' overall revenue fell 3.4 percent to 9.7 billion euros, dragged down by a 774 million euro charge connected to the value of the firm's own debt.
Adjusted for one-off costs, the bank's results surpassed market expectations, Jon Peace, a banking analyst at Nomura International in London, told investors in a research note on Wednesday. The bank's success in meeting its capital targets early also creates “expectations for a decent cash dividend payout for 2012,†Mr. Peace added.
Shares in the French bank rose 4.2 percent in early morning trading in Paris.
Last month, the ratings agency Standard & Poor's cut B.N.P. Paribas' credit rating by one notch, to A+/A-1 from AA-/A-1+.
S.&P. warned the French financial sector faced growing risks from the weakness in the euro zone, as well as the possibility that French real estate prices might decline. The ratings cut brings the B.N.P. Paribas' rating in line with those of its French rival Société Générale, which reports earnings on Thursday, as well as other global lenders like JPMorgan Chase and HSBC Holdings.
