UPDATE 1-BNP Paribas still eyes Fortis-CEO in paper

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PARIS, Dec 21 (Reuters) - BNP Paribas SA (BNPP.PA) is still interested in stricken bank Fortis (FOR.BR) after the collapse of the Belgian government over their handling of a rescue deal for Fortis involving BNP, its chief executive told a paper.

BNP CEO Baudouin Prot reaffirmed in an interview with Les Echos, however, that the bank would not need to have a capital increase if the deal failed and added that the bank was well positioned to post an overall profit in 2009.

A failure to strike a deal to buy Fortis (FOR.AS) would be a "missed opportunity" but "would not have a negative impact on BNP Paribas," Prot was quoted as saying in a preview of the Monday edition of the French newspaper.

Belgian Prime Minister Yves Leterme offered his government's resignation on Friday after the Supreme Court said there were strong signs of political meddling in a court case over the controversial rescue of Fortis at the height of the financial crisis.

BNP Paribas said on Thursday it was suspending a key part of the Fortis deal due to a legal challenge over the transaction.

In October, BNP had agreed to buy Fortis assets for 14.5 billion euros ($20.24 billion). As part of the deal, the Belgian government was to take a stake of 11.7 percent in BNP, and BNP was to take 75 percent of Belgian/Dutch group Fortis' Belgian arm, Fortis Banque.

The deal was designed to rescue Fortis, severely weakened by the financial crisis, but was also meant to strengthen BNP.

Fortis' large base of retail customer savings would make BNP Paribas the euro zone's biggest bank in terms of deposits and strengthen its capital position -- crucial for banks facing large losses from the credit crunch.

The plan was thrown into doubt earlier this month by a court ruling that found that the Belgian government had not fully considered the interest of Fortis shareholders in the deal to sell the company. The immediate consequence of the ruling was to suspend the transaction for 65 days. ($1=.7164 Euro) (Reporting by James Regan, editing by Maureen Bavdek)