Societe Generale has revealed a record-breaking fourth-quarter loss due to unauthorised trading apparently committed by Jerome Kerviel in addition to damage inflicted on the bank by the sub-prime crisis, Reuters reports.
SocGen had to admit to a $4.9 billion loss in the final quarter of 2007, but Executive Chairman Daniel Bouton tells Reuters that the bank would not remain independent despite speculation of a takeover bid from rival bank BNP Paribas.
“I am completely determined to continue with our strategy because, even taking into account our very bad year in 2007 due to the financial crisis and this fraud, it’s this strategy which creates and will create the most value for shareholders. This is my opinion, and it’s one that’s backed by the board,” says Bouton.
The news coincides with the release of a report by three independent board members, which highlights 75 separate warnings about Kerviel’s trading that management failed to investigate.
Shares in Societe Generale only dropped by 0.2 per cent in Paris trading following the news, even though the bank also announced it would be slashing its shareholder dividend.