BNP’s Payout Pledge Falls Flat With Investors as Costs Jump
- French bank to pay out 60% of profit to shareholders
- Shares fall as trading disappoints, costs outpace revenue
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BNP Paribas SA joined European peers in pledging higher profitability and bigger shareholder returns, while struggling to contain a surge in costs that’s plaguing the industry.
The Paris-based bank on Tuesday set a target for a return on tangible equity -- a key measure of profitability -- of more than 11% in four years’ time and vowed to return 60% of profit to shareholders. The shares fell as investors, who had priced in some of the new ambitions already, instead focused on a jump in operating costs that outpaced revenue growth in the fourth quarter.