MISSION INTANGIBLE

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MISSION:INTANGIBLE, the blog of the Intangible Asset Finance Society, offers critical comments on intangible asset, corporate reputation, and finance; supplemented by quantitative reputation metrics. Intangible assets include business processes, patents, trademarks; reputations for ethics and integrity; quality, safety, sustainability, security, and resilience; and comprise 70% of the average company's value. MISSION:INTANGIBLE is a registered trademark of the Intangible Asset Finance Society.

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BNP Paribas: Reputation risk realized

C. HUYGENS - Tuesday, September 02, 2014
In late June, the Financial Times  headed an article on the regulatory travails of BNP Paribas with the line, "Biggest threat to BNP Paribas could be to its reputation." That threat is apparently being realized.

In the article, journalists Michael Stothard and Martin Arnold reviewed the details of about $30 billion in trades between 2002 and 2009 with Sudan, Iran, and Cuba that had run afoul of US banking sanctions. Consensiv's analysis based on Steel City Re's data (below) shows a rock bottom reputation premium, peak reputation value risk, and a net reputational health of only 10% of the company's potential. The company's equity is down about 9% ($7.5B) since the beginning of the year and the indicated loss attributable to reputation from that is around $5B.


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