LONDON â€" BNP Paribas reported a 5 percent fall in its second-quarter profit on Wednesday as the French bank set aside further provisions to cover potential amid Europe’s struggling economy.
BNP Paribas said its net income during the three months through June 30 fell to 1.76 billion euros, or $2.33 billion, compared with 1.85 billion euros in the same period last year, beating analysts’ estimates. The company’s revenue fell 2 percent, to 9.9 billion euros, over the same period.
With the economies of many core European markets, like France and Italy, failing to post growth, the bank announced on Wednesday it was planning to expand its presence in emerging markets and Germany, Europe’s strongest economy.
Under the plans, BNP Paribas, France’s largest bank, said it would hire 500 people and increase its annual revenue from its German operations to 1.5 billion euros, while also increasing its asset-management unit in fast-growing emerging economies, particularly those in Asia.
The efforts are part of the French bank’s plan to cut 2 billion euros in costs from its operations by 2015, as well as shift some of its focus to developing countries in a search for new markets.
The move comes as BNP Paribas said pretax profit in several of its European divisions, including the retail units in France, Belgium and Italy, continued to fall. Pretax income from the French retail banking division fell 2 percent, to 536 million euros, while BNP Paribas’ Italian operations, BNL, posted an 11 percent drop, to 75 million euros.
The bank said it had made a further 1.1 billion euros in loan-loss provisions, up 30 percent compared with the second quarter of 2012, because of ongoing uncertainty in many European economies.
Pretax profit at BNP Paribas’ investment banking unit also plummeted 39 percent, to 497 million euros, as the French bank faced difficulties in the financial markets, which also have led many of its European rivals to report a fall in their trading activity over the quarter.
Although the French bank reported a decline in its net income, Jean-Laurent Bonnafé, the firm’s chief executive, said BNP remained well capitalized, and had reported an ‘‘overall good performance’’ despite the difficult economic situation.
‘‘The Group’s balance sheet is rock-solid,’ Mr. Bonnafé said in a news release.
BNP Paribas said that its common equity Tier 1 ratio, a measure of a firm’s ability to weather financial shocks, stood at 10.4 percent under the accounting rules known as Basel III at the end of the second quarter.
