* BNP aims to be EU leader in all its businesses with global
* To expand client franchise in Europe
* Will enter new markets in personal finance
* To trim retail branch network, headcount
(Adds comments from investor day)
By Maya Nikolaeva
PARIS, March 20 BNP Paribas, France's
biggest bank, plans to expand its investment banking activity in
Europe as competitors retrench, it said on Monday, part of a
strategy to offset weak revenue in domestic retail markets.
The bank aims to increase the number of clients in northern
Europe, including Germany, the United Kingdom and Scandinavia,
and expects to add 350 new customer groups by 2020, it said at
an investor day in Paris.
It fleshed out to investors its longer-term strategy,
announced in February, which will include continuing to close
retail branches and reducing headcount through natural
Yann Gerardin, head of corporate and institutional banking,
said clients were worried about European banks' commitment to
investment banking operations but BNP planned to continue
competing in a wide range of activities.
"In terms of retrenching of some of our competitors, we have
an opportunity to attract even more clients," he said.
European investment banks have lost market share in recent
years to their U.S. rivals, with Wall Street firms taking the
top three spots for investment banking fees in Europe in 2016.
However, BNP has performed better than some of its regional
peers, and its investment banking arm, CIB, earned more fees
than both Deutsche Bank and Barclays in
Europe last year, according to Thomson Reuters data.
"The future of CIB ... is also going to be a war on costs,
the more efficient we are, the more likely we are to compete
with the best American competitors," Gerardin said.
The bank in February announced plans to spend 3 billion
euros ($3.2 billion) from 2017-2020 to boost profitability,
including investing in digital technologies to boost cost
BNP Paribas trade union FO said on Monday that the bank
planned to close 200 retail branches in France and reduce staff
in its retail branch networks by 2 to 4 percent over two years.
BNP declined to comment on the numbers, but the investor day
presentation said a headcount reduction in France would come
through "natural turnover".
The bank reiterated its targets to boost dividend payouts
and increase its return on equity to 10 percent from 9.4
It said its domestic markets, such as France and Italy,
would eke out 0.5 percent revenue growth annually from 2017 till
However, it signalled that its revenue targets were based on
prudent macro assumptions taken a few months ago and that the
recent steepening of the yield curve could provide some "upside"
in the future.
Like other French banks, BNP Paribas faces a weak domestic
retail market and is looking at a year of political uncertainty,
with presidential elections looming and far-right leader Marine
Le Pen - who has advocated a retreat from the euro currency -
performing strongly in polls.
Shares in BNP Paribas fell 0.3 percent to 60.1 euros by 1555
GMT, against a little changed broader market.
"They are on a defensive side in terms of ambitions, it is a
business development plan that targets operational efficiency,
first of all, as the previous one did," Gildas Surry, a senior
analyst at Axiom Alternative Investments.
($1 = 0.9295 euros)
(Reporting by Maya Nikolaeva; Editing by Laurence Frost and