French banks are suffering indirect but significant losses of nearly 1 billion euros (US$1.33 billion) in potential as a result of the US$50 billion securities fraud allegedly perpetrated by Bernard L. Madoff Investment Securities LLC.

French investment bank Natixis, a subsidiary of the Caisse d' Epargne and Banque Populaire, estimated yesterday it could lose up to 450 million euros (US$605 million).

A statement by Natixis said the bank had made no direct investments in hedge funds managed by Madoff, but several of its clients had entrusted Madoff with securities. Natixis shares fell 6 percent yesterday.

France's largest bank BNP Paribas on Sunday announced a 350 million euros (US$466.9 million) potential loss as a result of the Madoff scandal.

According to a statement released Sunday, BNP has no investment of its own in Madoff's investment funds, but it "does have risk to these funds through its trading business and collateralized lending to funds of hedge funds."

BNP shares fell 9 percent yesterday morning on the Paris Bourse.

The 70-year-old Bernard Madoff, the former Wall Street CEO of the Nasdaq Stock Exchange, was arrested last Thursday on charges of defrauding investors of US$50 billion.