BNP Paribas’ long-time chief Bonaf’s eyes go for another three years

(Bloomberg) – After working at Bnp Paribas SA for over 13 years, Jean-Laurent Bonnafe has not yet completed it.

Less than two years before the CEO reaches retirement age, BNP Paribas asked shareholders to raise the age limit for their roles and give him a new three-year term on the board. The approval at the shareholders’ meeting in May will last for the 63-year-old until 2028, and even longer.

Bonnafe is already one of Europe’s longest bank CEOs, setting up a trading business and pushing asset management into the highest ranking, reaching a €5.1 billion ($5.5 billion) acquisition of Axa SA’s investment arm last year. Another chapter will give him the opportunity to oversee the remaining priorities, namely the overhaul of the vast French commercial and retail business, and ultimately develop a successor.

BNP Paribas’ two biggest competitors, Credit Agricole SA and Societe Generale SA, recently appointed new CEOs. At Socgen, Slawomir Krupa took over from long-time CEO Frederic Oudea about two years ago. Credit Agricole chose Olivier Gavalda in December to replace Philippe Brassac in May.

The proposal of the French Kuomintang, published on February 28 in the French journal Officials, will raise the CEO’s age limit from the current 65 years to 69 years. The lender also asked shareholders to raise the retirement age of chairman Jean Lemierre to 79, from 76. Lemierre took the job in December 2014 (Bonnafe has been CEO for three years).

Despite the lengthy position, no obvious candidate has followed Bonnafe’s footsteps. His two deputy CEOs, Yann Gerardin and Thierry Laborde, are 63 and 64 respectively.

Marguerite Berard, who oversees French retail and commercial banks and is regarded as a candidate for CEO positions by some within the bank, left last year and was recently appointed Dutch rival ABN AMRO BANK NV.

Also Read: Berard’s Challenge at ABN starts with learning Dutch only

Her successor Isabelle Loc has the opportunity to improve her profile if she succeeds in turning the retail business around. Analysts also pointed to the rising veteran seats in the company’s rankings.

The trouble with French commercial and retail operations is one of the reasons why BNP Paribas shares lag behind their European counterparts in the past two years as expensive hedges put the losses of local rules restricted, thus limiting the benefits of higher interest rates.

Despite these challenges, BNP’s stock has outperformed the broader industry during its Bonnafe tenure, with more than double the value. The billions of euros paid by shareholders further boosted investors’ earnings from selling subsidiaries in the United States.

But his landmark deal was until last year about when Bonaf agreed to take over Axa’s investment arm. The deal will create one of Europe’s largest currency managers and allow BNP Paribas to challenge Credit Agricole’s Amundi, the largest asset manager in Europe.

“BNP is one of the banks in Europe in the past decade and has grown the longest in the past decade,” Morningstar analyst Johann Scholtz said in an interview last month. “If you walk into shoes that leave such a big shoe on the organization like Bonnafe, it’s not easy.”

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