Are European banks feeling more heat than U.S. ones?
According to the New York Times and other reports, next week the European bank BNP Paribas will pay almost $9 billion in penalties to U.S. regulators and plead guilty to criminal charges. That follows other recent actions against bankers at Credit Suisse. But why are actions like these seemingly so infrequent?
“It’s not that the regulators are only focusing on the European banks. I think you could make the a strong case that the penalties that they’re seeking are may be a little bit disproportionate to the crimes, at least if you compare them to how much as a share of profits the American banks are having to pay,” says Cardiff Garcia with the blog FT Alphaville. “But I don’t think it’s that the regulators are singling out the Europeans. I think this is more just that the regulators sense a few issues where they can take some scalps and so they’re going for it.”
“It’s kind of the shareholders, in many cases, that have been held to account and not so much the actual people who are making the bad-guy decisions,” adds Catherine Rampell, a columnist and blogger for the Washington Post. “And I think that has a lot of people very angry and understandably so.”
Bank penalties weren’t the only thing being discussed on Wall Street this week, even though the business world slowed down as we approach the July 4 holiday. A terrible GDP report out this week had many wondering about economic growth in the U.S., especially earlier this year.
“Certainly things looked a lot worse in the end than they started in the beginning,” says Rampell. “It could turn out that the quarter was better actually than we thought…. and there are a lot of other data points in the U.S. economy that demonstrate that actually we’re doing better than the GDP number, at face value, suggests.”
And what about all the American attention paid to the 2014 World Cup and the U.S. men’s national soccer team?
” We’re all just exciteable enough to get into it while the U.S. is winning, and yet the minute we lose or we get knocked out,” Garcia says, “we’ll just say, oh well, whatever, it’s just soccer anyways.”
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