Reuters passes the WSJ Report: U.S. seeks $10 billion penalty from BNP over sanctions probe: WSJ (Reuters 5/30/14), here.
(Reuters) - The U.S. Justice Department is pushing BNP Paribas SA to pay more than $10 billion to resolve a criminal probe into allegations that the French bank evaded U.S. sanctions against Iran and other countries for years, the Wall Street Journal reported on Thursday, citing people familiar with the matter.
Sources told Reuters earlier this month that U.S. authorities were seeking more than $5 billion from the French bank.
The Journal said the final settlement amount could be less than $10 billion. Still, the multibillion dollar figure would put the fine among the largest penalties imposed on a bank and is far higher than what BNP has provisioned for.
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The $10 billion settlement figure would represent a "hit" of around 5 percent to the bank's tangible book value, Citigroup analysts said in a research note.
It would also reduce BNP Paribas' common equity tier 1 capital ratio to around 9.5 percent, a hit of around 10 percent on the bank's reported tier 1 capital ratio for the first quarter of 2014, Citigroup analysts said.
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Prosecutors have also pushed the bank to plead guilty to criminal charges as part of a resolution, sources have previously said.The gravamen of the U.S. angst, as reported, is not U.S. taxpayer offshore accounts used for U.S. tax noncompliance. However, I believe that the U.S. does have a bone to pick there. BNP Paribas is among the 14 who could not resolve its problems for such accounts in the U.S. DOJ initiative. I would expect that BNP Paribas will look to resolve all of this at the same time.