BNP Paribas is France’s largest bank by assets and it has said that it sees “promising” business opportunities in South Africa despite sluggish growth prospects in Africa’s largest economy.
Philippe Bordenave, BNP Paribas’s chief operating officer, said in Paris last week the group planned to expand its corporate and investment banking activities in South Africa, where it last year opened its first representative corporate and investment banking office in Johannesburg.
BNP Paribas, which operates in 80 countries, joins the growing list of global banks that have opened in South Africa, which they see as a launch pad into southern Africa. In August last year, JSE-listed financial services group Cadiz announced BNP Paribas would buy 60% of its equities business, Cadiz Securities, for R150m. The business has been rebranded BNP Paribas Cadiz Securities, which the French bank says it plans to strengthen, using it to develop its equities and research franchise in South Africa and sub-Saharan Africa.
Cadiz said when the deal was announced that the market in which the Cadiz Securities Business operates had been under pressure in recent years owing to lower local trading volumes on the JSE, tighter margins due to increased competition and foreign participation in the domestic market and the shift in the industry to electronic trading. It said management had identified the need to reposition the Cadiz Securities Business to gain access to a balance sheet, offshore distribution to capture foreign flows into the JSE and an offshore research base.
“We have not had a presence in South Africa and we decided to open an office last year because we think it is a very promising country,” Mr Bordenave said at the group’s annual media briefing on BNP’s business strategy.
“It is important to be there (in South Africa) for our clients and work with big South African corporates that are increasing exports and investing abroad,” he says.
BNP Paribas chairman Baudouin Prot also says the French group is “cautiously” growing its presence in South Africa, which he also describes as having potential despite the recent labour unrest in the mining sector and the political uncertainty that the African National Congress elective conference might bring.