BNP Paribas to pay $9bn record fine but bankers will still get their bonuses

BNP will pay the huge $8.9 billion fine from 'existing cash'

France’s BNP Paribas has agreed to pay a record $8.9 billion fine for working with countries subject to US sanctions, but most of its bankers will get their bonuses.

The bank’s finance director, Lars Machenil, speaking for the first time since last night’s deal with the four US regulators, said that staff bonuses would be based “on this year’s performance” and would “exclude the impact of the US fines”.

But the bank declined to respond to questions about whether or not its directors and senior executives would have their bonuses cut this year.

BNP will pay the fines and settlement to the US Department of Justice, Office of Foreign Assets Control, Manhattan’s district attorney and the New York Department of Financial Services.

It pleaded guilty in a New York court to falsifying records last night and will enter guilty pleas in a federal court next week on charges including trading with the enemy.

Mr Machenil said BNP would pay the fine from “existing cash” resources but told investors that plans to raise the dividend this year from €1.5 a share to around €2 would not happen. However, he promised a €1.5 cash pay-out for the year.

This went down well with investors  and BNP shares rose 3.5 per cent to  51.3 but they are still down more than 9 per cent this year.

Mr Machinel said: “At the end of the first quarter we had an overall excess of stable funding of  100 billion  (£79.86 billion) out of which  50 billion was in US dollars. Yesterday when I looked into the systems... that figure was basically unchanged at the end of the (second) quarter. This should allow having relevant cash for  the settlement.”

“We deeply regret the past misconduct that led to this settlement,” Jean-Laurent Bonnafe, chief executive of BNP, said.

“The failures that have come to light in the course of this investigation run contrary to the principles on which BNP Paribas has always sought  to operate.”

On top of the fines BNP will be barred from clearing certain US dollar transactions for the whole of 2015. It was also told to fire 13 individuals and not rehire them.

Sources said several dozen bankers who worked in the key areas like oil and gas financing, which broke sanctions against Sudan, Iran and Cuba, were likely to be demoted and have their bonuses cut and previous payments potentially clawed back.

Swiss regulator Finma today said it was investigating staff at BNP Paribas’ Geneva arm and had banned it from dealing with any sanctioned countries for two years.

News
peopleFrankie Boyle responds to referendum result in characteristically offensive style
Sport
Lewis Hamilton will start the Singapore Grand Prix from pole, with Nico Rosberg second and Daniel Ricciardo third
F1... for floodlit Singapore Grand Prix
Arts and Entertainment
'New Tricks' star Dennis Waterman is departing from the show after he completes filming on two more episodes
tvHe is only remaining member of original cast
Arts and Entertainment
tvHighs and lows of the cast's careers since 2004
PROMOTED VIDEO
Sport
Fans hold up a scarf at West Ham vs Liverpool
footballAfter Arsenal's clear victory, focus turns to West Ham vs Liverpool
New Articles
i100... she's just started school
News
news
News
ebooksAn unforgettable anthology of contemporary reportage
New Articles
i100
Life and Style
Couples have been having sex less in 2014, according to a new survey
life
Arts and Entertainment
musicBiographer Hunter Davies has collected nearly a hundred original manuscripts
Sport
football
New Articles
i100... despite rising prices
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Day In a Page

Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam