BNP Paribas considers bid for Société Générale
French bank BNP Paribas has announced that it is considering a bid for Société Générale (SocGen) following the €4.9 billion (£3.7 billion) rogue trader scandal.
SocGen, Frances’s second largest bank, is seen as an easy target following the worst trading scandal in history.
A spokesperson for BNP said we are considering a bid because all Europe’s banks are studying it. However, the French Government has warned off potential foreign bidders, insisting SocGen stays in French hands.
Santander and BBVA of Spain, UniCredit of Italy and HSBC are all thought to be interested.
Back in 1999, SocGen fended off a bid from BNP but there has been market speculation ever since about a merger between the 2 parties.
GSD Gestion fund manager, Jacques Gautier, said a SocGen-BNP tie-up would be good for shareholders of both banks, increasing overall profits.
Following the news, shares in SocGen surged 3.61% to €84.76 today after falling 13.4% to €66.8 since the scandal involving trader Jérôme Kerviel emerged.
Earlier this week, the board of SocGen renewed its confidence in Daniel Bouton, its chairman and chief executive, for a second time in the face of growing political pressure for him to step down.
Christine Lagarde, the French Finance Minister, and Nicolas Sarkozy, the French President, have called for a change at the top of the bank but the board has stood firm after last week refusing Mr Bouton’s resignation when the scandal emerged.