One of China's top banks has agreed to pay €3.9 million to settle a fraud probe in France, the authorities said today.

The Bank of China, which is buying Irish stockbroker Goodbody, confirmed the agreement, saying: "This principally concerns fund transfer activities of a Bank of China branch in China and has nothing to do with its Paris or other branches abroad."

It continued to do everything to strengthen measures to prevent money laundering, the bank said.

The agreement reached with the French authorities "does not imply any recognition of culpability and does not constitute nor carry the effects of a judgement of condemnation," it added.

The investigation was first launched in 2013 and established that money made through fraudulent trade deals in China was then moved offshore to east European banks before finding its way back to a Bank of China branch in Zhejiang province.

In all, the fraud involved about €40 million.

Last November the owners of Goodbody announced they had agreed a deal to sell the company to Bank of China.

It is understood the Chinese buyer will pay around €150 million for the firm, provided competition and regulatory approval is received.