The news, which steals a march on domestic rival SocGen
European banks, including Deutsche Bank
Many have also been selling assets, slashing jobs and cutting dividends to bolster their balance sheets and meet tougher regulations aimed at preventing a repeat of the 2008 financial markets crisis.
BNP, which has more than half of its credit-risk exposure in the euro zone, is ahead in the race with local rival SocGen, revealing on Thursday it had hit a Tier 1 capital ratio of 8.9 percent under tougher Basel III rules at end-June - six months ahead of schedule. It said its deleveraging was 90 percent done.
SocGen, meanwhile, is eyeing a Basel III ratio of at least 9 percent only by end-2013. Its deleveraging is 60 percent done.
"We are very confident for the second part of the year," BNP Chief Executive Jean-Laurent Bonnafe told Reuters Insider television. "This quite positive positioning will allow the group to concentrate on mid-term issues."
Markets including France, Italy and Belgium are expected to show "resilience" in the second half, Bonnafe added. BNP has benefited from relatively low household debt levels in these countries, despite the over-arching sovereign turmoil that is threatening to unravel decades of empire-building.
The CEO also pointed to European Central Bank head Mario Draghi's commitment to revive confidence if needed.
At 0725 GMT, BNP shares were up 2.3 percent at 31.37 euros, within a flat European blue-chip index. The stock, which often trades as a proxy for the euro zone, has lagged the STOXX Europe 600 bank index by 9 percent over the past year.
BNP saw second-quarter net income fall 13.2 percent to 1.85 billion euros, beating the average of analyst estimates of 1.74 billion in a Reuters poll.
Revenue dropped 8 percent to 10.10 billion euros, broadly in line with the poll average of 10.13 billion.
"The results are better than expected across the board," said Kepler Capital Markets analyst Benoit Petrarque.
As at rivals, BNP's corporate and investment bank bore the scars of cost cuts and volatile markets, with pretax profits sinking 40 percent and revenue down by a quarter. Retail banking, a division that has proven a lucrative counterweight to market turmoil, saw pretax earnings slip by a milder 2 percent.
BNP has sold loan portfolios to banks such as Wells Fargo
Asked whether BNP was embroiled in the Libor rate-fixing scandal, Bonnafe said the bank was "absolutely not" involved. He said regulators would have to change the way Libor was calculated.
(Editing by James Regan and Mark Potter)