The global banking group BNP Paribas, which runs BGL BNP Paribas here in the grand duchy, outlined plans to cut costs and return more money to shareholders on 13 March 2024. Archive photo: Matic Zorman / Maison Moderne

The global banking group BNP Paribas, which runs BGL BNP Paribas here in the grand duchy, outlined plans to cut costs and return more money to shareholders on 13 March 2024. Archive photo: Matic Zorman / Maison Moderne

BNP Paribas said it wants to save €2.7bn by 2025 and return €20bn to shareholders, pending approval, in a press statement.

BNP Paribas has shared its plans to speed up its efforts to save money and work more efficiently. The bank is focusing on cutting costs and improving how it operates to ensure it stays financially strong and can offer better returns to its shareholders, it said in a press release on Wednesday.

BNP Paribas stated that it has set a new goal to save an additional €400m in 2024, bringing its total savings target by 2025 to €2.7bn. This step is part of a wider strategy to make the bank’s operations leaner and more cost-effective.

In a separate announcement, BNP Paribas shared that its cost-saving strategies encompass several key initiatives, which includes combining resources (nearshoring and offshoring), implementing automation, robotics and digital technologies, speeding up the adoption of cloud platforms and artificial intelligence, making premises more efficient and flexible, strictly controlling external spending and improving global sourcing.

Looking ahead, BNP Paribas is optimistic about its financial health. It expects its earnings for 2024 to be higher than the previous year and is aiming for a steady increase in profits up to 2026. The bank plans to give back around €20bn to its shareholders between 2024 and 2026, depending on getting the necessary approvals.

The bank’s future growth is partially linked to the money it made from selling Bank of the West, in the US, in 2022. From this sale, it expects to see a return of over 16% by 2025. BNP Paribas is also working on making more money while keeping costs low, aiming for a positive difference of at least two percentage points from 2022 to 2025. Additionally, the bank is keeping a careful watch on lending and risks, aiming to keep potential losses below 40 basis points each year during its plan, stated the press release.

The group--which in Luxembourg includes the high street bank BGL BNP Paribas, BNP Paribas Securities Services, insurer Cardif Lux Vie and BNP Paribas Asset Management Luxembourg--has roughly 4,000 employees in the grand duchy.

A request from Delano for information on the potential impact of the cost-cutting scheme in Luxembourg had not been responded to at the time of publication.

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