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| Rogue trader to cost SocGen $7bn | Rogue trader to cost SocGen $7bn |
| (10 minutes later) | |
| French bank Societe Generale has announced losses of 6.9bn euros ($10.2bn, £5.2bn) and blamed on a fraud by its trader and the credit crunch. | French bank Societe Generale has announced losses of 6.9bn euros ($10.2bn, £5.2bn) and blamed on a fraud by its trader and the credit crunch. |
| Societe Generale said it uncovered a fraud of 4.9bn euros by a Paris-based trader, who has been suspended. | Societe Generale said it uncovered a fraud of 4.9bn euros by a Paris-based trader, who has been suspended. |
| It also announced new write downs of 2.05bn euros related to the sub-prime mortgage crisis in the US | It also announced new write downs of 2.05bn euros related to the sub-prime mortgage crisis in the US |
| The bank, one of France's largest, will need to seek 5.5bn euros in new capital to make good the losses. | The bank, one of France's largest, will need to seek 5.5bn euros in new capital to make good the losses. |
| 'Secret trade' | 'Secret trade' |
| "I am sorry but I have a hard time buying the fact that a trader was able to set up a 'secret trade' of 4.9 billion without anybody finding out," said Ion-Marc Valhi at Amas Bank. | "I am sorry but I have a hard time buying the fact that a trader was able to set up a 'secret trade' of 4.9 billion without anybody finding out," said Ion-Marc Valhi at Amas Bank. |
| The rogue trade took apparently took place last weekend, on 19 January. | The rogue trade took apparently took place last weekend, on 19 January. |
| Frederic Hamm, fund manager at Agilis Gestion, believes that the fraud "impacts the reputation of the bank". | Frederic Hamm, fund manager at Agilis Gestion, believes that the fraud "impacts the reputation of the bank". |
| Chief executive Daniel Bouton offered his resignation but it was rejected by the board, the bank said. | Chief executive Daniel Bouton offered his resignation but it was rejected by the board, the bank said. |
| Richard Fuld, the chairman of Lehman Brothers, told BBC News in Davos that "nothing stuns me, nothing really surprises me these days." | |
| Shares in the bank were suspended on Thursday. | Shares in the bank were suspended on Thursday. |
| Since the beginning of the year, the bank's shares have declined by 50%. | Since the beginning of the year, the bank's shares have declined by 50%. |
| Capital increase | Capital increase |
| The bank's losses have seriously dented its profits for 2007. | The bank's losses have seriously dented its profits for 2007. |
| The company will announce its full year results on February 21, and it said that it expect its 2007 net income to be in the range of 600m-800m euros. | The company will announce its full year results on February 21, and it said that it expect its 2007 net income to be in the range of 600m-800m euros. |
| Societe Generale is also going to raise 5.5bn euros through a capital increase "to strengthen its capital base". | Societe Generale is also going to raise 5.5bn euros through a capital increase "to strengthen its capital base". |
| Meanwhile, another French bank, BNP Paribas, said that "it has not revealed any loss of item that would justify any particular warning to the market". | Meanwhile, another French bank, BNP Paribas, said that "it has not revealed any loss of item that would justify any particular warning to the market". |