BNP faces shake-up as US dispute rumbles on

The logo of BNP Paribas SA sits outside a branch of the bank in Paris, France.
Balint Porneczi | Bloomberg | Getty Images
The logo of BNP Paribas SA sits outside a branch of the bank in Paris, France.

BNP Paribas is exploring a management shake-up including the departure of its chief operating officer as France's biggest bank struggles to reach a settlement with US authorities over alleged sanctions violations.

Georges Chodron de Courcel, chief operating officer, is set to leave the bank, according to two people familiar with the situation. One person close to the bank said the 64-year-old was retiring.

Mr Chodron de Courcel is chairman of its Swiss subsidiary, which has emerged as a focus of the investigation, and has a key role at the investment bank where many of the allegedly suspect transactions occurred.

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Several months ago the US Department of Financial Services requested Mr Chodron de Courcel be one of a dozen employees to leave the bank as part of any settlement, a person familiar with the matter said.

The bank's chairman Baudouin Prot, one of France's best-known bankers, took a couple of months off this year due to fatigue caused in part by the stress of the bank's inquiry into alleged wrongdoing, according to two people familiar with the matter.

People familiar with the bank's strategy said Mr Prot, 63, has no plans to step down. BNP declined to comment and neither executive could be reached for comment.

Read MoreUS seeks $10 billion penalty on BNP Paribas: WSJ

The transatlantic tussle over the bank's settlement escalated further on Thursday when US President Barack Obama said he would not intervene in the US Justice Department's case against BNP Paribas, despite France's President François Hollande's intention to discuss it with him.

"The tradition of the US is that the president does not meddle in prosecutions," Mr Obama said. "I don't pick up the phone and call the attorney-general. These are decisions made by an independent Department of Justice. Perhaps it is a different tradition than exists in other countries."

Mr Obama's comments came as France's markets watchdog warned protracted uncertainty over the size of the fine US authorities could impose on BNP Paribas was causing confusion among investors and called for greater clarity in the regulatory process.

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Gérard Rameix, chairman of the AMF, told the FT: "I hope a reasonable solution will be found and presented to the markets as quickly as possible, because it is not good to have such an amount of penalty at stake without knowing what the final deal is going to be."

Unconfirmed reports put the penalty at up to $10 billion, although people close to the bank say it has not yet been presented with a figure.

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Shares in the bank have fallen about 13 per cent since it made a $1.1 billion provision for the investigation into sanctions violations in February.

BNP Paribas is being investigated for allegedly violating US sanctions and anti-money laundering rules between 2002 and 2009 by disguising transactions in US dollars with countries including Iran, Sudan and Cuba.

Any settlement is likely to include the fine, a potential guilty plea and suspension of the bank's ability to clear US dollar transactions, according to several of the people.