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Bnp Falls As U.s. Probe Said To Cost More Than $5 Billion

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http://www.bloomberg.com/news/2014-05-21/u-s-said-to-seek-more-than-5-billion-in-bnp-settlement.html

BNP Paribas SA (BNP), France’s largest bank, fell to a seven-month low in Paris on concern U.S. authorities will seek more than $5 billion from the lender to settle a probe into alleged violations of U.S. sanctions.

The stock fell as much as 3 percent to the lowest since Oct. 1, and was down 1.8 percent at 50.73 euros as of 9:45 a.m. local time.

The amount sought in the probe of the lender’s dealings with countries including Iran and Sudan has escalated, and now far exceeds the $2.6 billion that Credit Suisse AG (CSGN) agreed to pay in a settlement with the U.S. for helping Americans evade taxes. Discussions are continuing and the final number could change, according to a person with knowledge of the matter. Last week, four people said U.S. authorities were asking for at least $3.5 billion to settle the BNP case.

A fine of more than $7 billion would jeopardize BNP’s dividend and could prevent the Paris-based lender from keeping its capital ratio, a measure of financial strength, above 10 percent, according to Alain Tchibozo, an analyst at Mediobanca SpA (MB) who has an outperform recommendation on the stock. Benjamin Lawsky, New York’s Superintendent of Financial Services, has also floated the idea of temporarily banning BNP from transferring money into and out of the U.S.

More importantly it keeps executives out of jail. Luckily this type of fine is unavailable for the plebs.

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Fingering a patsy like Kerviel or Adoboli seems to be out of fashion these days. Perhaps it's too much hassle because other employees may blow the whistle on the fact that the behaviour was endemic.

Seems easier for them to just take the fine and let the shareholders take the pain.

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http://www.bloomberg.com/news/2014-05-21/u-s-said-to-seek-more-than-5-billion-in-bnp-settlement.html

But it seems that they have been very naughty. A ban on clearing USD is a huge step though. A huge bank like BNP really relies on access to dollars.

More importantly it keeps executives out of jail. Luckily this type of fine is unavailable for the plebs.

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http://www.bloomberg.com/news/2014-05-21/u-s-said-to-seek-more-than-5-billion-in-bnp-settlement.html

But it seems that they have been very naughty. A ban on clearing USD is a huge step though. A huge bank like BNP really relies on access to dollars.

More importantly it keeps executives out of jail. Luckily this type of fine is unavailable for the plebs.

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