BNP says tough economy could spur opportunities for bolt-on deals
Reuters
Published Oct 26, 2023 14:34
PARIS (Reuters) - Slower economic growth in 2024 could create more opportunities for bolt-on acquisitions, BNP Paribas (EPA:BNPP) Chief Financial Officer Lars Machenil said on Thursday.
BNP, the euro zone's biggest bank, has in recent years invested in building up its equities trading business, notably by acquiring Deutsche Bank (ETR:DBKGn)'s electronic equity and prime broking operations, a deal that was completed in early 2022.
The French lender also approached the Dutch government last year to express an interest in taking over state-owned bank ABN Amro, a person with knowledge of the matter said at the time.
Asked by analysts to detail how BNP would use the remaining proceeds from the $16 billion sale of Bank of the West, its former U.S. retail subsidiary, Machenil said a fast-growing economy would shift the balance towards more investments.
"If the (economic) growth is a bit more timid, which is probably what we're going to see next year, then that fuelling of additional growth - natural, organic - will be a tad slower," Machenil said.
"But at the same time, there will be more turmoil on the markets and so probably more .... activities will be available to do deals with, so there might be a bit of a shift," he said.
Machenil didn't elaborate on the nature of the potential bolt-on acquisitions.
He reiterated that as well as the 5 billion-euro share buyback plan that BNP is on the verge of completing, the bank had pledged to deploy 7 billion euros worth of the proceeds on investments in its existing business and acquisitions.
"Depending on how the next year will unfold, yes (there) might (be a) shift a bit towards bolting on," he said.
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Written By: Reuters
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