BNP Paribas to Reopen Three Frozen Funds
BNP Paribas, France's biggest listed bank, said on Thursday it will reopen three funds next week that it had frozen amid subprime volatility in a step that accelerated a slide in financial stocks.
On Aug. 9, BNP Paribas said it had frozen three funds holding around $2.17 billion (1.6 billion euros) following problems in the U.S subprime mortgage sector, a move which added to turmoil in global financial markets.
"Since this decision and in the face of difficulties to obtain, in certain segments, market prices, BNP Paribas Investment partners has developed a methodology allowing, which it had planned originally, to reopen the process of subscriptions and buy-backs," it said in a statement.
On Aug. 28, at 1100 GMT, the BNP Paribas ABS Euribor and BNP ABS Eonia fund will resume and on Aug. 30 at 1300 GMT will be followed by the Luxembourg-listed Parvest Dynamic ABS.
The funds had a combined value on Aug. 7, their last day of normal operation, of 1.593 billion euros compared to 2.075 billion at July 27.
BNP said it expected the value of BNP Paribas Euribor to be 2 percent to 3 percent lower compared to Aug. 7. BNP Paribas ABS Eonia is seen down between 2.5 percent and 3.5 percent while Parvest Dynamic ABS is seen down between four percent and five percent.
But the bank added that due to market developments, these estimates could change between now and resumption.