July 3, 2014 / 1:25 PM / 4 years ago

EU finmins to discuss euro trade role after BNP case

PARIS, July 3 (Reuters) - Euro zone finance ministers will discuss on Monday ways to bolster the use of the euro in international trade in the aftermath of BNP’s record U.S. fine, France’s finance minister said, adding that other banks could face the same fate as BNP.

France’s largest bank has agreed to pay almost $9 billion to resolve U.S. accusations that it violated U.S. sanctions against Sudan, Cuba and Iran, in a severe punishment aimed at sending a clear message to other financial institutions around the world.

According to U.S. law, banks can be prosecuted for processing U.S. dollar transactions for countries subject to U.S. sanctions, even if the operations involve non-U.S. branches.

“BNP is the first but it is not the last one to risk facing such a situation,” French Finance Minister Sapin said. He did not name specific firms but said “this could concern banks in other European countries.”

“There will be initial discussions as early as next Monday at the Eurogroup to see how we could .. try to promote the usage of the euro,” he said on Thursday, referring to the monthly meeting of euro zone finance ministers.

He did not give any details on what would be discussed or what could be done to promote the euro.

“It would be a way to protect businesses when, outside of U.S. territory, they carry out transactions that are perfectly legal in the country they belong to,” he said.

French banks Credit Agricole and SocGen have disclosed that they are reviewing whether they violated U.S. sanctions. Sources familiar with the matter have said Agricole, SocGen, and Germany’s Deutsche Bank AG are among banks being investigated.

The French government has given a guarded welcome to Monday’s deal between BNP and the U.S. authorities but it had previously warned of consequences on talks on a major EU-U.S. trade deal if the sanctions were to be “disproportionate.”

French central bank governor Christian Noyer said last month that the threat that BNP could be suspended from clearing clients’ dollar transactions could be disruptive to the international financial system. (Reporting by Ingrid Melander; Additional reporting by Maya Nikolaeva; Editing by Andrew Callus)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below