BNP Paribas SA, France's largest bank, ING Groep NV, the biggest Dutch financial-services company, and Dexia SA, the world's largest lender to local governments, reported lower first-quarter earnings as loan losses increased.
BNP Paribas said net income fell 21 percent to 1.98 billion euros (US$3.06 billion), beating the median estimate of 1.62 billion euros from 11 analysts surveyed by Bloomberg News. ING said yesterday that profit dropped 19 percent to 1.54 billion euros, matching analysts' predictions, and Dexia's earnings plunged a more-than-estimated 60 percent to 289 million euros.
Dexia Chief Executive Officer Axel Miller said losses in the United States 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 told Bloomberg Television.
Dexia fell as much as 4.1 percent in Brussels trading after the firm said earnings were cut by an "unexpected provision" of 128 million euros at Financial Security Assurance Holdings Ltd bond-insurance unit. BNP Paribas rose 2.2 percent in Paris trading and Amsterdam-based ING gained 1.1 percent.
BNP Paribas, which wrote down assets at its investment bank by 514 million euros, sidestepped the worst of the subprime fallout. The world's biggest financial institutions saw US$335 billion of markdowns and credit losses since the start of last year.