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.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
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

Recruitment Genius: Customer Relations Officer

£13000 per annum: Recruitment Genius: This is an exciting opportunity to join ...

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Jemma Gent: Project Coordinator

£12 - £15 Hourly Rate: Jemma Gent: In this role you will report to the Head of...

Recruitment Genius: Evening Administrator

£8 per hour: Recruitment Genius: This Pension Specialist was established early...

Day In a Page

Homeless Veterans campaign: Donations hit record-breaking £1m target after £300,000 gift from Lloyds Bank

Homeless Veterans campaign

Donations hit record-breaking £1m target after huge gift from Lloyds Bank
Flight MH370 a year on: Lost without a trace – but the search goes on

Lost without a trace

But, a year on, the search continues for Flight MH370
Germany's spymasters left red-faced after thieves break into brand new secret service HQ and steal taps

Germany's spy HQ springs a leak

Thieves break into new €1.5bn complex... to steal taps
International Women's Day 2015: Celebrating the whirlwind wit of Simone de Beauvoir

Whirlwind wit of Simone de Beauvoir

Simone de Beauvoir's seminal feminist polemic, 'The Second Sex', has been published in short-form for International Women's Day
Mark Zuckerberg’s hiring policy might suit him – but it wouldn’t work for me

Mark Zuckerberg’s hiring policy might suit him – but it wouldn’t work for me

Why would I want to employ someone I’d be happy to have as my boss, asks Simon Kelner
Confessions of a planespotter: With three Britons under arrest in the UAE, the perils have never been more apparent

Confessions of a planespotter

With three Britons under arrest in the UAE, the perils have never been more apparent. Sam Masters explains the appeal
Russia's gulag museum 'makes no mention' of Stalin's atrocities

Russia's gulag museum

Ministry of Culture-run site 'makes no mention' of Stalin's atrocities
The big fresh food con: Alarming truth behind the chocolate muffin that won't decay

The big fresh food con

Joanna Blythman reveals the alarming truth behind the chocolate muffin that won't decay
Virginia Ironside was my landlady: What is it like to live with an agony aunt on call 24/7?

Virginia Ironside was my landlady

Tim Willis reveals what it's like to live with an agony aunt on call 24/7
Paris Fashion Week 2015: The wit and wisdom of Manish Arora's exercise in high camp

Paris Fashion Week 2015

The wit and wisdom of Manish Arora's exercise in high camp
8 best workout DVDs

8 best workout DVDs

If your 'New Year new you' regime hasn’t lasted beyond February, why not try working out from home?
Paul Scholes column: I don't believe Jonny Evans was spitting at Papiss Cissé. It was a reflex. But what the Newcastle striker did next was horrible

Paul Scholes column

I don't believe Evans was spitting at Cissé. It was a reflex. But what the Newcastle striker did next was horrible
Miguel Layun interview: From the Azteca to Vicarage Road with a million followers

From the Azteca to Vicarage Road with a million followers

Miguel Layun is a star in Mexico where he was criticised for leaving to join Watford. But he says he sees the bigger picture
Frank Warren column: Amir Khan ready to meet winner of Floyd Mayweather v Manny Pacquiao

Khan ready to meet winner of Mayweather v Pacquiao

The Bolton fighter is unlikely to take on Kell Brook with two superstar opponents on the horizon, says Frank Warren
War with Isis: Iraq's government fights to win back Tikrit from militants - but then what?

Baghdad fights to win back Tikrit from Isis – but then what?

Patrick Cockburn reports from Kirkuk on a conflict which sectarianism has made intractable