European banks are posting lousy results, but–with some notable exceptions–they have thus far largely avoided the giant writedowns that have crushed their counterparts in the US.
In results out this morning, BNP Paribas (BNP.PA), BNP beat consensus: 1.98 billion euros (-21% year-over-year) of profit against estimates of 1.62 billion euros. ING Groep (ING) was in line, with profits dropping 19% year-over-year to 1.54 billion euros. Dexia missed consensus after earnings plumeted 60% to 289 million euros due to 216 million euros in writedowns on credit default swaps. Bloomberg:
Dexia Chief Executive Officer Axel Miller said losses in the U.S. exceeded expectations because of the collapse of the subprime mortgage market, while Baudouin Prot, his counterpart at Paris-based BNP Paribas, said the financial markets were “more difficult than expected.”
“The impact on our capital markets activity of the very I would say violent crisis of especially March has hit the numbers,” Prot said in an interview with Bloomberg Television.
BNP Paribas, like most other European banks in recent months, took a smaller loss on sub prime-related exposure than its American counterparts, writing down only 514 million euros at its investment banking division.
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