French Economy Minister Christine Lagarde said Societe Generale (SocGen), reeling from losses blamed on a rogue trader, is a bank in crisis and may need to ditch its chairman.
"Societe Generale is in a crisis situation," Lagarde told LCI TV yesterday.
"In a difficult moment, the board members are there to decide if the person in charge is the best placed to run the ship when it is pitching a bit, or whether they should change the captain," she said.
French Prime Minister Francois Fillon said the government would defend SocGen from any hostile takeover.
``The government will not let Societe Generale become the object of hostile raids,'' Fillon said, adding, "The government is very attentive to any risk of destabilization of Societe Generale."
SocGen said last Thursday that it had uncovered massive unauthorized stock trading by one of its employees that led to 4.9 billion euros (US$7.22 billion) in losses at the 144-year-old bank.
Jerome Kerviel, a 31-year old junior trader, was placed under investigation for breach of trust and other misdeeds on Monday, but judges threw out the stronger accusation of fraud made by the bank and prosecutors and freed him on bail. Prosecutors said they would appeal against his release.
Kerviel's lawyers, however, were jubilant.
"There is no fraud, sir. There is no fraud. The word fraud was used by [bank chairman Daniel] Bouton numerous times," lawyer Christian Charriere-Bournazel.
"Mr Bouton held this unfortunate man up for public vilification, threw him to the dogs ... and there was no substance to it," he told reporters late on Monday.
Lagarde's comments put fresh pressure on Bouton to step down after French President Nicolas Sarkozy turned up the heat on SocGen's top managers on Monday evening, saying they would have to accept their share of responsibility for the world's biggest trading scandal.
Lagarde and Justice Minister Rachida Dati have said it was up to the bank's board to decide Bouton's fate. But Bouton's departure would raise a problem of succession because his heir apparent, Jean-Pierre Mustier, heads the investment division that employed Kerviel and has also been damaged by the crisis.
Meanwhile, the bank rejected claims that an American member of its supervisory board, Robert Day, had inside information about the rogue trader losses when he made two major share sales this month.
"No inside information was used in any way with respect to these December and January sales," it said.
In related developments, EU Internal Markets Commissioner Charlie McCreevy said yesterday that no regulatory measures could have prevented the SocGen crisis.
"No regulation in the world could have foreseen what happened last week in France," he told reporters in Brussels.
Later in a speech at a European Financial Services Conference, he said investors would learn to assess the value of their portfolios themselves rather than relying on credit rating agencies.
US President Donald Trump yesterday announced sweeping "reciprocal tariffs" on US trading partners, including a 32 percent tax on goods from Taiwan that is set to take effect on Wednesday. At a Rose Garden event, Trump declared a 10 percent baseline tax on imports from all countries, with the White House saying it would take effect on Saturday. Countries with larger trade surpluses with the US would face higher duties beginning on Wednesday, including Taiwan (32 percent), China (34 percent), Japan (24 percent), South Korea (25 percent), Vietnam (46 percent) and Thailand (36 percent). Canada and Mexico, the two largest US trading
AIR SUPPORT: The Ministry of National Defense thanked the US for the delivery, adding that it was an indicator of the White House’s commitment to the Taiwan Relations Act Deputy Minister of National Defense Po Horng-huei (柏鴻輝) and Representative to the US Alexander Yui on Friday attended a delivery ceremony for the first of Taiwan’s long-awaited 66 F-16C/D Block 70 jets at a Lockheed Martin Corp factory in Greenville, South Carolina. “We are so proud to be the global home of the F-16 and to support Taiwan’s air defense capabilities,” US Representative William Timmons wrote on X, alongside a photograph of Taiwanese and US officials at the event. The F-16C/D Block 70 jets Taiwan ordered have the same capabilities as aircraft that had been upgraded to F-16Vs. The batch of Lockheed Martin
GRIDLOCK: The National Fire Agency’s Special Search and Rescue team is on standby to travel to the countries to help out with the rescue effort A powerful earthquake rocked Myanmar and neighboring Thailand yesterday, killing at least three people in Bangkok and burying dozens when a high-rise building under construction collapsed. Footage shared on social media from Myanmar’s second-largest city showed widespread destruction, raising fears that many were trapped under the rubble or killed. The magnitude 7.7 earthquake, with an epicenter near Mandalay in Myanmar, struck at midday and was followed by a strong magnitude 6.4 aftershock. The extent of death, injury and destruction — especially in Myanmar, which is embroiled in a civil war and where information is tightly controlled at the best of times —
China's military today said it began joint army, navy and rocket force exercises around Taiwan to "serve as a stern warning and powerful deterrent against Taiwanese independence," calling President William Lai (賴清德) a "parasite." The exercises come after Lai called Beijing a "foreign hostile force" last month. More than 10 Chinese military ships approached close to Taiwan's 24 nautical mile (44.4km) contiguous zone this morning and Taiwan sent its own warships to respond, two senior Taiwanese officials said. Taiwan has not yet detected any live fire by the Chinese military so far, one of the officials said. The drills took place after US Secretary