By Maya Nikolaeva
PARIS (Reuters) - BNP Paribas
France's biggest listed bank declined comment.
U.S. authorities are probing whether BNP Paribas evaded U.S. sanctions relating primarily to Sudan between 2002 and 2009, and whether it stripped identifying information from wire transfers so they could pass through the U.S. financial system without raising red flags, sources have said.
The bank is expected to plead guilty to a federal criminal charge and pay nearly $9 billion, as part of a larger settlement with multiple enforcement authorities that could be announced as early as next week, sources said earlier this week.
An announcement by U.S. authorities on the settlement is expected on Monday, a source familiar with the matter said.
BNP is also likely to be suspended from converting foreign currencies into dollars on behalf of clients in some businesses for as long as a year, according to sources familiar with the matter, an untested and severe penalty for the French bank accused of persistently violating U.S. sanctions laws.
Analysts have predicted that the fine may hit the bank’s dividend plans and regulatory ratios.
Deutsche Bank analysts on Tuesday factored in a zero dividend payout for 2014 in their forecasts for BNP, based on a $9 billion fine. That would help the French bank maintain its core equity Tier 1 ratio - a key measure of its financial strength - at close to 10 percent.
BNP set a 1.5 euros per share payout to shareholders on its 2013 results and its dividend payout ratio stood at 40.8 percent of net income.
The Wall Street Journal on Friday cited a person familiar with the matter saying the bank expects to dramatically reduce its dividend. BNP also plans to issue a multibillion-euro bond, the paper added, without giving the exact size.
The settlement between BNP and the U.S. authorities is expected to be announced on Monday, although both sides are still ironing out final details, the person told the newspaper.
BNP Paribas said two months ago when it published first-quarter results that its 23 billion euro ($31 billion) medium- and long-term wholesale funding program for 2014 was already 80 percent complete.
Shares in BNP Paribas were 0.8 percent higher by 1345 GMT (9.45 a.m. ET). The stock has lost nearly 20 percent of its value since it first announced a provision for the fine in mid-February.
(Additional reporting by Leigh Thomas; Editing by James Regan and David Holmes)