* 2010 FY underlying earnings fall 3 percent to 3.88 bln euros
* Company strikes optimistic note for macro economy in 2011
* New business hit by slow growth in France, Japan, US
* AXA shares down 1 percent
* BNP takes hit on falling AXA share price
(Recasts, adds detail, background)
By Nina Sovich
PARIS, Feb 17 (Reuters) - AXA, Europe's second-biggest insurer, said it was focused on restoring the reputation of its asset management business as it reported a fall in underlying group profits for the year.
Profits in AXA's asset management business fell 26 percent in the year. Earlier this month the unit was hit by a $242 million fine paid to US regulators for concealing a computer glitch at its subsidiary AXA Rosenberg which cost investors millions of dollars.
AXA's CEO said on Thursday that the company had replaced managers in the US, UK, Japan and Middle East in a bid to improve performance. He also said that AXA was trying to turn around the asset mananagement business.
"There are some reputational issues there... some outflow. There will be a turnaround in years to come," he said, referring to the damage to its unit's reputation from the SEC fine.
"2010 has been an interesting year... we have had a chance to reflect on lessons of the crisis," said CEO and Chairman Henri de Castries said in a conference call with analysts.
"2011 and beyond we will be a position to consolidate our leadership."
AXA needs to prove that it can stem losses in its asset management business and solidify gains in Asia after its share price fell nearly 25 percent in 2010 as the company also struggled to close a deal to buy the Asian assets of AXA Asia Pacific and global markets turmoil hit returns.
"It's a year of transition for them," said one Paris-based analyst.
AXA is trying to retool its main business -- the sale of life, property and casualty insurance -- away from slow growth regions like France to focus on fast growth countries in Asia such as China.
But declines in France, Japan and the U.S. continued to pull at growth. Life and savings new business on an "annual premium equivalent" (APE) basis -- an industry measure used to iron out market volatility -- fell 2 percent for the year, to 5.78 billion euros.
New business in southeast Asia and China grew by 58 percent and Central Europe grew by 16 percent.
French bank BNP Paribas -- which owns 5.2 percent of AXA according to Reuters data -- missed forecasts for fourth-quarter profit on Thursday after it booked a 534 million euros ($723 million) charge on the value of its AXA stake.
BNP blamed the surprise charge on "highly volatile" post-crisis stock markets that had taken AXA shares below their book value.
AXA will present a more detailed strategic plan in June and will likely close a long-running deal to buy out AXA Asia Pacific by the end of the first half, the CEO said.
(Reporting by Nina Sovich and Julien Ponthus; editing by Geert De Clercq, Mike Nesbit)