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July 25, 2008 5:13:45 PM CDT

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BNP Paribas Halts Fund Withdrawals

Posted Aug 9, 07 12:35 PM CDT in World,  Business 

(Newser) – France's largest bank today froze three investment funds threatened by the subprime mortagage collapse, claiming it can’t “fairly” place a value on their rapidly declining assets. Citing the “complete evaporation of liquidity” in the US securities market, BNP Paribas halted withdrawals from the funds, which were worth $2.2 billion, down 20% in less than 2 weeks, Bloomberg reports.

“For some of the securities there are just no prices,” said a BNP Paribas executive. The company’s shares fell 5.5% on the announcement, and the European stock index dropped more than 2%. As recently as last week, the bank had said its exposure to the American subprime crisis was “absolutely negligible.”

Source Bloomberg

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BNP Parisbas Chief Executive Baudoin Prot smiles before presenting the bank's full-year 2006 results in Paris, in this Feb. 15, 2007 file photo. BNP Paribas, announced Thursday, Aug. 9, 2007 that it...   (Associated Press)
French bank BNP Paribas Chief executive   (Getty Images (by Event))
An Algerian youth passes by a sign of the French BNP Paribas...   (Getty Images)
The headquarters of Deutsche Industriebank IKB in Duesseldorf, western Germany, are seen in this July 30, 2007 file photo. Shares of IKB rose more than 3 percent Wednesday Aug. 8, 2007 after the German...   (Associated Press)
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subprime mortgages  • Bear Stearns  • finance  • bank  • stock  • BNP Paribas  • mutual funds


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