* New York regulator wanted Chodron de Courcel to go -source
* Bank says 64-year old was due to retire anyway
* BNP has lost 11 bln euros or 15 pct of market value in 4
(Recasts with more on talks)
By Andrew Callus and Maya Nikolaeva
PARIS, June 12 The chief operating officer of
BNP Paribas is to step down at the end of June and
retire completely on Sept. 30, France's biggest bank announced
on Thursday as talks with U.S. authorities over a potential $10
billion fine gathered pace.
New York's banking regulator had requested the departure of
the long-serving Georges Chodron de Courcel as part of a
settlement for alleged violations of sanctions against Iran,
Sudan and other countries, a person familiar with the matter
told Reuters on June 5.
U.S. authorities - five of them in all including the New
York financial regulator - are investigating whether BNP evaded
U.S. sanctions between 2002 and 2009. Sources familiar with the
matter say they are trying to establish whether the bank
stripped out identifying information from wire transfers so they
could pass through the U.S. financial system without raising red
Conference calls with various U.S. authorities are taking
place every six hours, a source familiar with the matter in
"Negotiations are far from over, but everybody would like to
see the case move forward quickly," the source said. "We
understand that the U.S. authorities want to reach a settlement
before July 4 at the latest."
BNP Paribas did not mention the investigation in its
announcement. It said the 64-year-old's departure, in less than
three weeks' time, was at his own request and would allow him to
comply with new French bank regulations on the number of
directorships he can hold.
Chodron de Courcel is one of the bank's three most senior
managers under Chief Executive Jean-Laurent Bonnafe and has
direct responsibility for the investment banking activities that
are at the centre of the investigation.
A spokeswoman for the bank said he had planned to retire
this year anyway and would not comment further on the U.S.
proceedings. A source familiar with matter said last week the
bank was not considering executive departures in connection with
The bank said Chodron de Courcel had "devoted his entire
42-year career to BNP and then BNP Paribas, and has made a
decisive contribution to the Group's development, and especially
to the project which eventually led to the creation of the new
BNP Paribas entity".
On Wednesday, a person familiar with the matter said Vivien
Levy-Garboua, a senior adviser and formerly the head of
compliance for the French bank, was also among people targeted
by the superintendent of New York's Department of Financial
Services, Benjamin Lawsky.
BNP Paribas may have to pay a fine of about $10 billion and
face other penalties such as being suspended from clearing
clients' dollar transactions, sources close to the situation
The potential impact has raised concern in French government
and banking circles. President Francois Hollande raised the
issues with Barack Obama last week.
On Wednesday, Bank of France Governor Christian Noyer said a
dollar clearing suspension could be disruptive to the
international financial system.
BNP has said publicly only that it is in discussions with
U.S. authorities about "certain U.S. dollar payments involving
countries, persons and entities that could have been subject to
It has set aside $1.1 billion for the fine but told
shareholders it could be far higher than that. Last month it
also said it had improved control processes to ensure such
mistakes did not occur again.
The bank's market value has dropped by 15 percent, erasing
around 11 billion euros ($15 billion), in the four months since
it first announced the provision for the fine on Feb. 13. Its
shares closed up 0.2 percent at 51.46 euros on Thursday.
Since then the scale of the likely fine has risen sharply,
and a figure as high as $16 billion was suggested at one point,
according to people familiar with the matter.
In the past two years the U.S. Justice Department has said
it has broken records on penalties for corporate misconduct at
least seven times, including three times this year alone. The
most recent was Credit Suisse in May, which paid $2.6 billion
over charges that it helped Americans evade U.S. taxes, the
largest penalty ever levied in a criminal tax case.
Total corporate criminal penalties in the United States
overall increased about 647 percent between 2001 and 2012 to
about $4.3 billion, according to figures compiled by University
of Virginia law school professor Brandon Garrett.
There are multiple explanations for the rising fines. For
one, cases related to the 2007-2009 financial crisis have
produced big settlements connected to trillions of dollars in
subprime mortgage products. U.S. authorities have also turned
their attention to other crimes involving big dollar amounts,
including money laundering, sanctions violations and the rigging
of benchmark interest rates.
($1 = 0.7345 Euros)
(Reporting by Andrew Callus, Matthias Blamont, Blaise Robinson,
Alexandre Boksenbaum-Granier and Natalie Huet; Editing by
Ingrid Melander, Philippa Fletcher and Will Waterman)