Goldman Sachs CEO fears risks to system if rival banks plead guilty
The head of US bank Goldman Sachs has warned that guilty pleas from rivals BNP Paribas and Credit Suisse, under legal proceedings in the United States, could hurt the financial system.
The head of US bank Goldman Sachs has warned that guilty pleas from rivals BNP Paribas and Credit Suisse, under legal proceedings in the United States, could hurt the financial system.
The two European banks, under probes for violating US sanctions and abetting tax evasion, are potentially facing very heavy fines that could reach billions of US dollars.
US authorities are urging the banks to plead guilty and have threatened criminal prosecution, which could lead to the revocation of their licences - potentially forcing other banks to determine whether to continue doing business with them.
For us to not deal with someone would be a further risk to the system
Goldman Sachs chief executive Lloyd Blankfein, asked about the issue on the sidelines of the bank's annual shareholder meeting in Texas, said it would be difficult to stop doing business with the two European banks.
Given the many ties between the world's banks, the resolution of the case could affect internal credit relationships within the financial system, Blankfein said, according to comments reported by .
"It becomes a very weighty decision to cut someone off, and we wouldn't do it lightly."
He said the impact "depends on what the consequences of the guilty pleas are."
