Suryaa Business Desk: In the third quarter financial results of France's 'BNP Paribas', the largest banking giant in the Eurozone... France's BNP Paribas, the largest banking giant in the Eurozone, has shown excellent performance in its third quarter financial results. The bank, which posted strong net profits that beat market experts' expectations, announced a 1.3 billion euro share buyback as a huge gift to shareholders. The management of the bank revealed that the financial position of the company has become stronger due to changes in international interest rates and strong corporate banking segment revenues.
In this context, BNP Paribas Chief Executive Officer (CEO) Jean-Laurent Bonafé made a key statement while talking to the media. After discussions in the upcoming board meetings, he clarified that there is a possibility of increasing the dividend and return payout ratio to shareholders from the current 60 percent to 70 percent of the bank's annual earnings. Free cash flow in the company has increased significantly due to improved competitiveness and increasing profitability, hence plans to increase the normal payout ratio, he said. With the European banking sector posting record profits over the past few years, there are huge opportunities for investors to deliver high capital returns.
This positive decision taken by BNP Paribas further strengthened the investor sentiment in the European financial markets. Financial analysts expect the payout hike and share buyback plans to be formalized through a final decision by the executive board in the coming weeks.