‘Great Counterparty’
BNP Paribas remains a “great counterparty,” Cantor Fitzgerald & Co. CEO Shawn Matthews told Bloomberg Television in an interview yesterday.
Moody’s Investors Service said the guilty plea could prompt some clients to avoid the bank, either voluntarily or because internal policies prevent them from doing business with a firm that admitted to a felony. Moody’s changed its outlook on BNP Paribas’s bank financial strength rating to negative from stable yesterday, while affirming its long-term debt and deposit ratings.
The bank has applied for a regulatory exemption it needs to be able to keep managing U.S. pension-plan assets following the guilty plea. The exemption would enable the bank to keep its status as a qualified professional asset manager, a key designation for institutions overseeing pension assets.
Kinner Lakhani and Nicholas Herman, analysts for Citigroup Inc., reduced their estimates for BNP Paribas earnings per share by 3 percent for 2015 and 4 percent for 2016 because of the impact on corporate banking revenue.
“It’s hard to think it can be business as usual,” said Piers Brown, an analyst at Macquarie Bank Ltd. in London. The growth plan “isn’t as straightforward as it sounds and some elements are being undermined.”