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
PROMOTED VIDEO
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: Software Development Manager

£40000 - £50000 per annum: Recruitment Genius: This is an exciting opportunity...

Ashdown Group: Product Manager - (Product Marketing, Financial Services)

£30000 - £35000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...

Recruitment Genius: Compliance Assistant

£13000 per annum: Recruitment Genius: This Pension Specialist was established ...

Ashdown Group: Market Research Executive

£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...

Day In a Page

Isis hostage crisis: The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power

Isis hostage crisis

The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power, says Robert Fisk
Missing salvage expert who found $50m of sunken treasure before disappearing, tracked down at last

The runaway buccaneers and the ship full of gold

Salvage expert Tommy Thompson found sunken treasure worth millions. Then he vanished... until now
Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Maverick artist Grayson Perry backs our campaign
Assisted Dying Bill: I want to be able to decide about my own death - I want to have control of my life

Assisted Dying Bill: 'I want control of my life'

This week the Assisted Dying Bill is debated in the Lords. Virginia Ironside, who has already made plans for her own self-deliverance, argues that it's time we allowed people a humane, compassionate death
Move over, kale - cabbage is the new rising star

Cabbage is king again

Sophie Morris banishes thoughts of soggy school dinners and turns over a new leaf
11 best winter skin treats

Give your moisturiser a helping hand: 11 best winter skin treats

Get an extra boost of nourishment from one of these hard-working products
Paul Scholes column: The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him

Paul Scholes column

The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him
Frank Warren column: No cigar, but pots of money: here come the Cubans

Frank Warren's Ringside

No cigar, but pots of money: here come the Cubans
Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Larry David, Steve Coogan and other comedians share stories of depression in new documentary

Comedians share stories of depression

The director of the new documentary, Kevin Pollak, tells Jessica Barrett how he got them to talk
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
English Heritage adds 14 post-war office buildings to its protected lists

14 office buildings added to protected lists

Christopher Beanland explores the underrated appeal of these palaces of pen-pushing
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee