French bank BNP Paribas, under the threat of severe US penalties on charges of sanctions busting, announced on Thursday that its chief operating officer Georges Chodron de Courcel is to quit on June 30.
At the beginning of June, various sources told AFP that the bank would sack Chodron de Courcel to placate US judicial authorities. But on Thursday the bank said that Chodron de Courcel, aged 64, was taking retirement at his own request.
Press reports have suggested that the bank could be hit by a fine of €7.4 billion euros or more, and risks being banned for a period from carrying out transactions in dollars or even losing its US banking licence.
France has hit back at the United States, warning that the scale of the possible penalties could disrupt talks between the 28-member European Union and the United States over a huge free-trade pact.
Chodron de Courcel is in the sights of the US authorities which accuse BNP Paribas, a top French and European bank, of having broken sanctions against Iran, Sudan and Cuba between 2002 and 2009 by carrying out dollar transaction with them.
The New York banking regulator Benjamin Lawsky called several months ago for Chodron de Courcel to be dismissed, AFP has learnt.
His departure will be seen as marking one of the first big concessions which the bank makes in its negotiations with the US authorities.
The matter has sparked concern at the highest levels of France, with President Francois Hollande appealing on a number of occasions to US President Barack Obama about what he considers the "disproportionate" scale of the reported sanctions.
Hollande raised the dispute again with Obama over a dinner in Paris last week, although Obama had made clear that he could not interfere in a US judicial process.
Central bank concern
The governor of the French central bank, Christian Noyer, is reported to have visited New York recently to plead on behalf of the bank and to warn US authorities of possible knock-on damage to the French and international financial system, and to recovery of the French and European economies.
Some analysts however are sceptical about the extent of such repercussions, although some other big banks are also being probed by US officials for alleged sanctions busting, and some banks have already paid heavy fines.
In the statement on Thursday, BNP Paribas did not mention its legal problems in the United States.
It said that Chodron de Courcel, who would retire fully on September 30 but is a director of several other companies, was also leaving to comply with new French banking regulations restricting the number of company directorships an individual could hold.
Some reports had said that the board of the bank was split over how to ward off the US authorities, with some arguing that the bank had done nothing wrong under French and European law, a line backed by Noyer, and others saying that the bank should not have ventured into such transactions.
In the statement Chodron de Courcel, who had spent his entire 42-year-career at the bank, said: "I am proud to have contributed to building this outstanding group, which has now become one of the European leaders in its industry."
Chodron de Courcel is linked to the family of Bernadette Chirac, wife of former French President Jacques Chirac.
Licenced in Iran
As news of Chodron de Courcel's departure broke, so did word US authorities authorized the bank to operate in Iran earlier in the year, even as they considered penalties against the French bank for earlier breaking an embargo imposed on the country.
The US Treasury Department granted the bank two licenses in February and March for transactions in Iran as sanctions were being reduced against the country.
The reductions were the result of November negotiations in Geneva in which Iran and the P5+1 permanent UN Security Council members met over the country's nuclear activities.
News of the licenses was first made public by The Wall Street Journal, which hinted the licenses could be a routine measure to allow the bank to wind down its business in Iran. A Treasury spokeswoman told AFP that the information was obtained via a Freedom of Information Act request.
According to the Journal, the Treasury granted the licenses while US prosecutors were seeking to impose a huge fine on the bank.