BNP Paribas, France’s largest bank, has said its acquisition of a stake in troubled Belgian-Dutch bank Fortis will not go ahead as planned following a Brussels Court of Appeal ruling on a case brought by some 2,200 dissident Fortis shareholders.

In a statement, the French bank said that last week's ruling on the protests of the shareholders means the transaction cannot proceed as before.

This does not signify a loss of interest in rescuing the Belgian arm of Fortis, Fortis Banque, a BNP Paribas spokesperson told WealthBriefing.

The Brussels appeal court froze for 65 days decisions taken by the Fortis board at the start of October on the company’s carve-up, and ordered that Fortis shareholders be allowed a say by 12 February 2009.

The highly sensitive nature of negotiations meant the bank would not comment further on the matter.

BNP Paribas also called off an extraordinary shareholders meeting which had been set for Friday to vote on the Fortis takeover.

Under the original terms of the deal, BNP Paribas was to buy Fortis’ assets for €14.5 billion ($20.8 billion). The fledgling Belgian government of Yves Leterme was to take a stake of 11.7 per cent in BNP, and BNP was to take 75 per cent of Fortis' Belgian arm. 

On Wednesday, a parliamentary committee was set up to examine the case. The delayed deal has prompted calls for Mr Leterme’s resignation.

It is widely believed that the integration of Fortis, so severely depleted by the financial crisis, would strengthen BNP Paribas after a difficult few months, as well as relieving the acquiree.

On Wednesday, the French giant reported €710 million of losses at its investment banking unit.

In a statement, BNP Paribas said it could cut 5 per cent of jobs at the unit as part of a restructuring that would also see it reduce its market risk and bonds inventories.

The bank also stated that the unit had been hit by rocky financial markets and its exposure to the alleged $50 billion fraud by US financier Bernard Madoff.

On Sunday, BNP Paribas said its loss from the alleged fraud, which has hit so many of the world's top financial institutions, could be €350 million.