France’s BNP Paribas harbors ambitious plans for its Swiss business: assets under management as well as profit are due to rise substantially thanks to a set of measures that includes cost cuts.
Geoffroy Bazin, CEO of BNP Paribas Switzerland since 2013, on Friday presented the growth plan named «Swiss Forward». He presented the new strategy as part of a video produced in entertaining fashion.
The French bank set itself ambitious targets for the four years through 2020. BNP Paribas wants to boost revenue from its operations to 500 million Swiss francs from a current 380 million a year, according to a report by «Finance Corner» yesterday.
The bank has been active in Switzerland for 140 years and operates four branches, in Geneva, Zurich, Lugano and Basel. It identified three separate measures to drive its growth project in the country:
1. More Assets Under Management
Assets under management are due to increase by a third to 32 billion francs come 2020. The bank today has 24 billion in assets under management. It will hire some ten relationship managers to reach its target, adding to the 30 it has recruited in 2016.
BNP Paribas Switzerland used to have 35 billion francs under management before reducing the target markets to 60 from 150, partially due to the repatriation of untaxed assets.
2. Focus on Medium-sized Companies
BNP Paribas aims to expand its business with exporters with sales of more than 250 million francs. It has identified 400 potential customers and hopes to attract 15 to 20 new customers a year.
3. Plans for Trading Unit
The third measure is directed at the earnings in the «Specialized Trade Solutions» division, which the bank hopes to double. The company in the past years has reduced the number of trading accounts with moderate transaction volumes to 250, from an original 2,500.
The bank aims to focus on clients with a potential for development, with a certain size and solidity. BNP Paribas also distanced itself from sheer speculation and stopped trading in coal and palm oil.
Cost Cuts as Part of the Plan
The company also has decided to implement a savings program designed to reduce its spending by 40 million francs a year, mostly by cutting jobs in the back offices and in IT. The bank plans to outsource those services to a company that belongs to the banking group and is based in Portugal.
BNP Paribas currently employs some 1,500 people in Switzerland, with 1,300 based in Geneva and 200 in Zurich. The rest of the staff is working in Lugano and Basel.
