French bank BNP Paribas said yesterday that it routinely meets with foreign investors, while declining to comment directly on reports that it plans to tour the Middle East in coming days in a bid to raise up to €2 billion (Dh10.2 billion) in fresh capital.
"BNP Paribas naturally conducts roadshows every year to present the bank and promote its shares with investors around the world," a spokesman said.
The Financial Times reported that Chief Executive Baudouin Prot is preparing a contingency plan with potential investors to inject cash into the bank in case the European debt crisis worsens.
The bank yesterday reiterated recent comments that BNP Paribas aims to be in line with new Basel III rules by January 2013 with a common equity Tier 1 ratio of 9 per cent: "That's to say, six years before the final implementation date of 2019," the spokesman said.
French bank shares have been under enormous pressure since the beginning of the summer on concerns over their exposure to Europe's deepening sovereign debt crisis. BNP Paribas, France's largest bank by market value, is heavily invested in Italian bonds worth around €21 billion.
The Financial Times said BNP Paribas executives have urged regulators to carry out an emergency stress test in an effort to pinpoint exactly where the weaknesses are in the French banking system. That could lead to some kind of orchestrated injection of state funds, its said, citing bankers.
It suggested that the talks in Qatar and Abu Dhabi are intended to provide the French bank with an alternative to a forced recapitalisation if it were demanded.
BNP Paribas has taken repeated steps to reassure investors that its finances are solid. A week ago, it announced plans to slash its enormous balance sheet and boost its capital ratios.
CEO Prot said the bank would refocus its business on strategic activities, slashing its dollar liquidity needs and reducing assets in order to comply with Basel III capital rules by the start of 2013.