No threat to Societe Generale
PARIS (Bloomberg) - Societe Generale SA, the French bank where a trader's unauthorised bets led to a record 4.9 billion euros ($7.2 billion) loss, published an open letter to clients saying the future of the bank is not threatened.
"This accident, however serious it may be, doesn't endanger the good health of the company," Societe Generale said in a full-page advertisement published in Le Parisien and Le Monde newspapers on Saturday.
Societe Generale said on January 24 that errant trades on European stock index futures by 31-year-old Jerome Kerviel had led to a 4.9 billion-euro loss, depleting the bank's capital and spurring talk of a takeover.
The bank hired JPMorgan Chase & Co. and Morgan Stanley to underwrite a planned 5.5 billion euro-stock offering. Societe Generale said in the letter "a large number of shareholders and investors" have expressed an interest in taking part.
Societe Generale has 2,953 branches in France, accounting for 7.5 percent of the country's total, according to 2006 figures from the Bank of France. The bank also has 8.4 million retail customers in 30 countries outside France, mainly in central and eastern Europe, the Mediterranean, and Africa.
BNP Paribas SA and Credit Agricole SA, France's largest and third-biggest banks, said this week they are considering bids for Societe Generale.
"We received a countless number of messages of sympathy and support," the bank said in its letter to clients. "Our determination to fulfill our role in the economy of our country and to accompany and finance its growth remains intact."