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Business

Societe Generale chief Bouton resigns

Video by Luke SHRAGO

Latest update : 2009-04-30

French bank Societe Generale's chief executive Daniel Bouton stepped down on Wednesday. He announced his resignation in an interview with French daily Le Figaro, saying he was taking the step "to protect" the bank.

AFP - Daniel Bouton, president of French bank Societe Generale, told the daily Le Figaro on Wednesday he was resigning to "protect" the company.
  
Bouton said: "I have handed in my resignation. The board will elect a new president on May 6. I am choosing to go now to protect the bank. I have become the target of incessant attacks that finally damage the company that I am very attached to."
  
The banker, who admitted "I certainly made errors," said he would leave with no golden handshake.
  
Societe Generale denied Monday a press report that it could face losses of up to 10 billion euros (13 billion dollars) because of risky investments at one of its asset management units.
  
"Societe Generale formally denies the claims published by Liberation today," said a statement by the bank, which last year announced losses of 4.9 billion euros in a rogue trading scandal it blames on trader Jerome Kerviel.
  
The left-wing daily Liberation said Societe Generale's SGAM Alternative Investments unit had invested heavily in complex financial products, which had left the bank with 10.4 billion euros in "toxic" assets at the start of 2008.
  
The detailed report, splashed over Liberation's front and four inside pages and headlined "The Other Scandal at Societe Generale," described the products as "unsellable."
  
It added that "even if... the bank has recorded losses of 'only' 1.2 billion euros, the final bill could reach 10 billion."
  
But Societe Generale said that Liberation had confused losses with asset transfers at the division.
  
It noted that "SGAM's losses for 2008 were 258 million euros after tax" as shown in the bank's results statement in February, when it reported a net profit for the year despite the financial crisis.
  
Societe Generale said net profit for 2008 came to two billion euros compared with 947 million in 2007 when it absorbed the huge loss it attributed to unauthorised actions by Kerviel.
  
The bank shocked the financial world in January last year when it announced the losses incurred as it was forced to unwind more than 50 billion euros of unauthorised deals the 31-year-old trader is said to have made.
  
Kerviel turned himself in to police after the bank revealed the losses and was charged with breach of trust, fabricating documents and illegally accessing computers.

Date created : 2009-04-29

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