True, BNP Paribas $8.9bn fine is a high punishment that sets precedents in the banking sector. But relative to the lender’s earning is quite modest. About a dozen employees have been fired or see their pay cut. But will that change anything?
In Iceland, where the three major banks collapsed during the 2008-2011 financial crisis and relative to the size of the economy that was the largest crack ever experienced by any country, things have been quite different. Former PM Geir Haarde was put on trial for “gross negligence” on the banking collapse. Entities have also been hold accountable, as well as their managers. Last week only four bankers were sentenced for market manipulation and breach of fiduciary duty.
Icelandic reporter Sigrún Davíðsdóttir, who has been putting her country’s crisis in context, explains that this time is not the main fish of the pond, and “the numbers are not as high as in some of the other cases, most noticeably the al Thani case. It was however an important judgement because there are other similar cases snarling their way through courts.”
“The four bankers are, with the exception of Birkir Kristinsson, not household names in Iceland. However, this is yet another banking-collapse case from the Office of the Special Prosecutor. Since there are other similar cases this verdict is indicative but none of these cases is over until ruled on by the Supreme Court.”
*Read the original blog post here.