The Dirty Dozen #4: BNP Paribas

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While BNP Paribas, the leading French bank, the only foreign bank active in Iran, the nature of its activities in that country is sufficiently important to merit investor attention.  In total, the company is involved in financing projects in that country valued at more than $2 billion. 

In July 2002, BNP Paribas, along with Germany’s Commerzbank AG, led Iran’s first sovereign Eurobond offering since the state’s 1979 revolution.  Originally scheduled for Euro 500 million, high demand for the instruments led BNP Paribas to increase the offering to a total of Euro 625 million.  In December 2002, a second offering of Euro 375 million, also led by BNP Paribas and Commerzbank, brought the total raised on behalf of the Iranian government to over Euro 1 billion.1

The company also is involved in the financing of projects and export facilities in Iran including an aromatics plant and a number of energy and infrastructure-related deals.  In total, the company is involved in credit lines totaling more than $1 billion to increase Iranian trade and development.2

Public pension systems, university endowments and individual investors should divest BNP Paribas stock for three reasons:

  • Hard Currency: At the same time the U.S. is seeking to deny Iran funding for its sponsorship of terrorism and weapons of mass destruction programs, BNP Paribas, along with Commerzbank, raised well over $1 billion on behalf of the Iranian government.  While U.S. investors cannot legally hold Iranian debt, these offerings allow global investors to provide unrestricted cash resources directly to Tehran.  Put simply, there are now millions of investors worldwide that are directly underwriting the odious Iranian regime. 
  • The Role of Finance: Banks play a vital role in the economies of terrorist-sponsoring states by underwriting projects that create substantial revenues for the government.  Without leading banks such as BNP Paribas, the governments of Iran, Libya and other terrorist-sponsoring states would find it more difficult to stimulate the type of development and project financing required to enjoy continued economic growth.
  • Moral and Political Cover:  When leading global companies such as BNP Paribas partner with terrorist-sponsoring states, it sends a clear message to these governments: Sponsoring terrorism is not a concern as long as there are corporate profits to be made.  This message undermines U.S. sanctions and international diplomatic efforts.

BNP Paribas was also probed in 2004 by Britain’s MI6 and MI5 intelligence agencies for allegedly misusing funds and transactions related to the UN’s Iraq Oil-for-Food program.3 At a November 2004 hearing in the House International Relations Committee, at least three instances were revealed where BNP Paribas reassigned letters of credit from U.N.-approved relief sponsors to illegal third parties.4


1. MEED, 12/20/02.

2. Company Website, 10/02; Financial Times, 1/29/02; and Asia Pulse, 3/01.

3. Winnett, Robert and Mark Hollingsworth. "MI6 Probes French links to Iraq scam." The Sunday Times, August 1, 2004.  4. Rosett, Claudia. "Rohrabacher to Probe Role of French Bank." The New York Sun, April 27, 2005.

Center for Security Policy

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