Bank of France Governor Christian Noyer said the U.S. investigation into BNP Paribas SA (BNP)’s dealings with sanctioned nations may encourage companies to stop using dollars in international transactions.
“We could say that companies would have maximum interest to do the most possible transactions in other currencies,” Noyer, who is also a member of the European Central Bank’s Governing Council, said yesterday on BFM television. “Trade between China and Europe — do it in euros, do it in renminbi, stop doing it in dollars. This is an affair that will leave marks.”
Noyer’s remarks are the strongest yet from French authorities protesting the size of the possible fine BNP Paribas may face in the matter. U.S. investigators are said to seek more than $10 billion in fines, a guilty plea and the suspension of dollar-clearing operations to settle the probe into France’s biggest bank’s dealing in countries including Iran and Sudan. As the world’s reserve currency, dollars are used internationally in trades of goods ranging from oil to airliners.
The threat suspension of ability to settle in dollars in the U.S. is “something that can put in danger the good functioning of the international financial system because BNP Paribas is a big player in this area,” Noyer said. “I hope if there are sanctions in this area, they are limited in a way that is not dangerous.”
Full article: France’s Noyer Says BNP May Prompt Shift Away From Dollar (Bloomberg)