"BNP’s €178.2bn mortgage loans potentially impacted more than 500k households..."

The homeownership rates of few European countries like Italy, Belgium & France in 2019 were 72.4%, 71.3%, and 64.1%¹. Buying a house is cheaper than renting². It builds long-term wealth, which can be transferred to their heirs, thus, giving financial security^2,3. Psychologically, it gives a sense of stability and is emotionally satisfying³. However, buying a house could be expensive in most countries and may not be at par with an individual’s income⁴. This is why financial institutions offer mortgage loans to bridge the gap⁴. A mortgage is a loan that enables an individual to purchase or maintain a home⁵. 93.4% of the US’s new homes were purchased with a mortgage in 2019⁶. Buying a house also offers tax advantages like deduction of interest paid on mortgages⁷, thus, helping in saving a significant amount of money for the owner³.

BNP Paribas, a French bank’s total mortgage loans in 2020 were €178.2bn across France, Belgium, Italy & the US^8;p68-82. As per BNP Paribas Fortis, Belgium, in 2019, 55% of the mortgages (excluding refinancing) were taken to buy a new home with an average loan of €207,000⁹. Thus, the number of households impacted by the mortgages given by BNP could be nearly 500,000 households globally⁹.

Assuming the average loan size of other countries was the same as Fortis’ and 55% of the mortgages (excluding refinancing) were taken to buy a new home, through French Retail Banking’s €90.1bn mortgages, 250k households were impacted^8;p68. Belgian Retail Banking’s €53.9bn mortgages^8;p72 impacted 140k households. BNL Banca’s (Italy)^8;p49 €25.5bn mortgages^8;p70 impacted 70k households and BancWest’s (US)^8;p70 impacted 23k households.

BNP’s total mortgage loans formed 9.39% of the total mortgage balances in France (€1,136.9bn), Belgium (€275.38bn), & Italy (€391.52bn)^8;p49-72,¹⁰.

To a great extent in Belgium & France, and to a lesser extent in Italy & the US, BNP provided mortgages to buy a home, easing lives of individuals while providing financial stability.

Sources

• 1. https://www.statista.com/statistics/246355/home-ownership-rate-in-europe/
• 2. https://www.forbes.com/sites/trulia/2016/11/15/want-to-be-financially-secure-buy-a-house/?sh=377edb091378
• 3. https://homeguides.sfgate.com/homepath-mortgage-require-pmi-35452.html
• 4. https://www.worldatlas.com/articles/countries-with-the-highest-home-ownership-rates.html
• 5. https://www.investopedia.com/terms/m/mortgage.asp
• 6. https://www.supermoney.com/studies/mortgage-industry-study/
• 7. https://en.wikipedia.org/wiki/Home_mortgage_interest_deduction
• 8. https://invest.bnpparibas.com/documents/4q20-slides-54814
• 9. https://www.bnpparibasfortis.com/newsroom/press-release/nearly-all-mortgage-lending-records-broken-in-2019
• 10. https://www.statista.com/statistics/614792/outstanding-residential-mortgage-lending-europe-by-country/

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