(Bloomberg) — BNP Paribas SA reported a blowout performance in fixed-income trading that beat all but one of the large Wall Street banks, allowing the French lender to move past embarrassing losses from equity derivatives. The shares surged.

Revenue from trading fixed-income securities, currencies and commodities jumped 154% in the second quarter from a year earlier, trailing only Morgan Stanley’s 168% gain. The bank said volumes were driven by governments and corporations selling debt to deal with the coronavirus crisis, as well as foreign exchange and commodities hedging by clients.

The results more than offset a 53% decline in equities trading that was worse than analysts had expected, as the bank navigated what it called a “still-challenging market” for derivatives and lower volumes in the business with hedge funds.

BNP has been among banks leading a lobbying effort to resume shareholder payouts as they benefit from unprecedented market volatility and extensive government stimulus. Chief Executive Officer Jean-Laurent Bonnafe cut costs and worked to improve the trading unit over the past years, but the heavy losses at the equities business that he wants to grow were a reminder of banks’ many vulnerabilities in this crisis.

Lars Machenil, BNP’s chief financial officer, said the lender will comply with a request by the European Central Bank that banks hold off on dividends and buybacks at least until the end of the year in order to preserve capital and keep lending.

“Supervisory authorities extended their recommendation to not pay dividends until the end of the year, and of course we will comply,” he said in an interview on Bloomberg TV. “One assumes that when the environment doesn’t further deteriorate, this recommendation will not be extended.”

BNP jumped as much as 6.3% in Paris trading and was up 3.1% as of 12:39 p.m., paring losses this year to 33%. The stock had been hit hard by the cancellation of dividends because the French firm previously made some of the biggest payouts to investors among European peers.

BNP set aside 1.4 billion euros ($1.7 billion) for future loan losses in the second quarter. The lender reiterated a forecast that profit for the year could be 15% to 20% lower than in 2019.

European banks in general have taken a less aggressive approach to provisions, because they’re not as profitable as their Wall Street rivals, but also because they benefit from broad government loan guarantees. UBS Group AG signaled it’s considering reviving shareholder payouts, in a sign that the worst hit on its balance sheet was over.

More details from BNP’s second-quarter results:

Net income EU2.3b vs Bloomberg-compiled estimate EU1.49 billionRevenue EU11.7b vs estimate EU10.9 billionCIB revenue EU4.1b vs estimate EU3.2bCommon equity Tier 1 ratio 12.4% vs estimate 11.9%Provision for loan losses EU1.4b vs estimate EU1.7 billionFICC sales & trading revenue EU2b vs estimate EU1.09bEquity trading revenue EU290m vs estimate EU485m

Like its French competitors Societe Generale SA and Natixis SA, BNP suffered steep losses in the first quarter on complex equity derivatives that backfired when the market went into a tailspin and companies across the globe canceled dividends. BNP said there was “only a residual impact” in the second quarter from those cancellations.

Fixed-income trading benefited from a broad-based market rally that helped U.S. peers double revenue in that business. Wall Street banks’ trading and dealmaking businesses recorded their best quarter in modern history, with $45 billion in revenue.

(Updates shares in seventh paragraph.)

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