Banking Crisis
France's Hollande Turns To Germany For Support Over BNP Paribas Saga In US - Report
French President Francoise Hollande has turned to his European cousins for help against what he deems unfair punishment by the US against BNP Paribas, media reports said.
French President Francois Hollande has turned to Germany for help against what he deems unfair punishment by the US against BNP Paribas, a Financial Times report said yesterday, citing a French official.
According to the FT, Hollande has had discussions with Angela Merkel, the German chancellor, and other top European government officials - including some from the UK. The talks have taken place amid expectations that France’s largest bank will plead guilty and pay a $8-$9 billion fine for breaching American trade sanctions against Iran, Sudan and Cuba.
The President hopes his intervention will stop the authorities adding further penalties on the bank and prevent the bank from going out of business altogether in the US.
The New York Department of Financial Services reportedly wants to prevent the bank temporarily from clearing US dollar transactions - which could damage its wholesale banking business. BNP is trying to negotiate terms whereby it can clear through other banks.
Earlier this month, Hollande reportedly warned that banning BNP Paribas from transacting in dollars would threaten the stability of the eurozone, and that America’s demands were “disproportionate” and “unfair” towards the French bank.
The news follows allegations that it breached American trade sanctions against Iran, Sudan and Cuba. US authorities believe BNP set up regional banks in Africa and the Middle East to hide the transactions.
Hollande has also previously, according to reports, held discussions with President Obama with little success. Obama showed no interest in intervening in the prosecution.
Authorities are reportedly trying to avoid any large scale damage on the bank’s large US retail network BancWest.
BNP Paribas said last week it is holding to its plan to expand its BancWest division in the US. It will hire almost 100 wealth management advisors through 2016, Sofia Merlo, co-head of wealth management at BNP Paribas, told Bloomberg.
