The French government admitted that Societe Generale is in crisis after the huge losses caused by Jerome Kerviel, currenty dubbed as a genius by the web followers.
The French government vowed to defend the second largest bank Societe Generale against any hostile take over bids.
Christine Lagarde, French minister added pressure on the bank chairman Daniel Bouton over the handling of the $7.15 billion dollar loss.
The government also said that they are very attentive to any risk of destabilization of Societe Generale.
France’s top two banks BNP Paribas and Credit Agricole are said to be eyeing on Societe Generale, France’s third biggest bank by market capitalization. If any of these two banks don’t take the bank over, expect Barclays’ bank to make a move, the question of whether they will succeed remains to be seen.
Kerviel was placed under formal investigation on Monday for breach of trust, using false documents and breaching computer laws. Kerviel was released on bail, but the prosecution is appealing.
Turning the spot light to the Bank’s chairman Bouton for a moment, Bouton should be held accountable for the biggest losses in the history of investment banking. “You cannot escape your responsibilities,” Sarkozy said late Monday pointing to Societe Generale Chairman Bouton—that I agree with. Just imagine how much this guy makes….
Boutons fate lies in the mercy of Societe Generale’s board, per the French finance minister.
Keriviel, if found guilty of breach of trust would face a maximum sentence of three years in prison and a fine of $186,000.00
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By: Rouge Trader actions sweetens Societe Generale for possible take over « B M A N M E D I A on February 1, 2008
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