Looking for His glorious appearing! Titus 2:13

Financiers may grumble that the United States is acting like an imperial power in punishing foreign banks for dealings far beyond U.S. territory, but in the end they are more likely to bow to Washington than kick against its dollar muscle.

Last week, French politicians and business leaders demanded an end to the global dominance of the U.S. currency - and hence of the U.S. banking system - after a New York court fined French bank BNP Paribas $9 billion for doing business in Sudan, Iran and Cuba. Yet despite irritation at the long reach of U.S. sanctions, most bankers see that as wishful thinking.

Instead, major lenders in Europe and Asia are reacting to the steady flow of punishments from the United States by doing ever more to comply with U.S. laws and by cutting business ties in countries Washington dislikes rather than risk its wrath and, in the worst scenario, risk exclusion from the dollar system.

Official regulators outside the United States are starting to look at ways to prevent their own banks and markets from being damaged by the scale of U.S. penalties. But for now, each bank on its own has little choice but to toe Washington's line.

"The demands placed on banks to know their customer's customer, even in countries where such records are not routinely kept, means that banks have little choice but to terminate relationships or risk eye-watering, balance sheet altering fines," said Anthony Browne, chief executive of the British Bankers' Association (BBA).

The BBA estimates Western banks have cut hundreds of relationships with correspondent banks in emerging markets, hurting businesses, governments and people in poorer countries.

Large commodity traders such as Glencore, Vitol, Trafigura and Mercuria are stepping in to plug the gap in trade finance. Glencore was chosen last month by the government of Chad to finance its purchase of $1.3 billion of assets being sold by U.S. oil company Chevron.

Meanwhile, far from turning their backs on the United States as a result of the demands of regulators and judges, foreign banks who have fallen foul of U.S. rules are doing everything they can to ensure they can still tap the world's financial epicenter.

BNP has set up a financial security unit in New York to ensure its staff comply with all U.S. sanctions and all of its U.S. dollar flows will ultimately be processed and controlled via its branch in New York, centralizing activities that used to be spread across various international offices.

Russia "wake-up call"

For all that, there are plenty of bankers with whom the U.S. attitude rankles. Many - privately - sympathize with the senior British banker who was quoted in U.S. legal papers when his bank was fined in 2012 for breaching sanctions on Iran.

In an expletive-charged broadside, the executive was quoted as saying: "You ... Americans! Who are you to tell us, the rest of the world, that we're not going to deal with Iranians?"

Nowadays, bankers are loath to object in public to U.S. requirements, even though privately many believe Washington is using its financial dominance to push its foreign policy agenda and give its own banks the edge over foreign rivals.

"It's the U.S. that people worry about," said the chief executive of a bank in the United Arab Emirates, the Gulf state that has long been forum for business with sanctions-hit Iran.

"If the U.S. says you must clamp down, you have to do it."

New York attorney Adam Kaufmann dismissed the idea that the United States was engaging in "financial imperialism" overseas or targeting foreign banks for economic gain. U.S. courts were simply applying laws in respect of the domestic banking system - where foreign banks need some presence if they are to clear payments in dollars, wherever in the world they are made.

"If you're going to use U.S. financial institutions, you have to play by U.S. rules," said Kaufmann, a former prosecutor involved in numerous sanctions violations cases.

Despite grumbling from European players, U.S. banks have also suffered. JP Morgan was fined a record $13 billion this year for misleading investors during the housing crisis.

In Russia, where Western sanctions imposed on Moscow over this year's Ukraine crisis have prompted tens of billions of dollars in capital flight, the BNP fine may make international banks even more wary of doing business with Russian customers.

Brian Zimbler, managing partner of U.S. law firm Morgan Lewis's Moscow office called BNP's penalty a "wake-up call":

"Banks around the world are very scared of the U.S. authorities," he said. "They are less likely to want to do deals with any counterparty in Russia unless they know them well."