Daniel Bouton, the chairman and chief executive of Société Gé*érale, won a reprieve yesterday after the board of the beleaguered bank voted unanimously to keep him at the helm. This came as the bank announced it had set up an independent task force to investigate last week's €5bn (£3.7bn) trading scandal.
M. Bouton and his co-chief executive, Philippe Citerne, have faced mounting political pressure to quit since the crisis emerged last Thursday, but SocGen's board stood firm yesterday. The board members voted to keep M. Bouton and M. Citerne at the helm, despite calls for a change in management from President Nicolas Sarkozy and finance minister Christine Lagarde earlier this week. M. Bouton also had his offer to resign rejected last week.
Yesterday, the board announced the creation of a "special committee" with extensive powers to investigate the trading losses caused by the alleged rogue trader Jérôme Kerviel.
The committee is to be made up of independent directors and chaired by Jean-Martin Folz, who retired as head of the French car group PSA Peugeot Citroë* last year. Joining him will be Jean Azéma, the general manager of the insurer Groupama, and Antoine Jeancourt-Galignani, formerly of Crédit Agricole.
One of the committee's principal concerns is to find out if SocGen has identified all of the trading losses and their causes. It will also check that appropriate measures have been taken to avoid any recurrence.
In a statement released yesterday, SocGen said: "In order to successfully carry out its mission, the special committee has been given extensive powers." The committee can call on any outside adviser or expert in the course of its investigation. Yesterday it revealed it had hired the auditors PricewaterhouseCoopers.
The bank also denied reports suggesting that it would welcome a friendly takeover approach. A spokesman categorically denied the reports.
Groups rumoured to be interested include domestic rival BNP Paribas and Banco Santander. Yet the French government could be heading towards a showdown with the European Union over protectionism relating to SocGen's case.
On Tuesday, the French Prime Minister, François Fillon, said: "The government is determined that Société Gé*érale remains a great French bank."
A spokesman for the European commissioner Charlie McCreevy said that, should a foreign bidder come in, the government should not intervene. "The same rules apply as in other takeover situations under free movement of capital rules. Potential bidders are to be treated in a non-discriminatory manner," he said. HSBC and BBVA were named as other potential foreign bidders by a Citigroup note this week.
Separately, BNP Paribas released solid full-year figures, despite a decline in fourth-quarter profits, citing "difficult economic conditions". It posted a 7 per cent rise in net income to €7.8bn in 2007.