French banking giant Societe Generale faces a tough annual general meeting on Tuesday, when shareholders will be told the bank’s internal inquiry tallies with rogue trader Jerome Kerviel’s assertion he bet, unauthorised, over 50 billion euros due to individual and systematic negligence.
When he was discovered he claimed he acted alone, although this week press reports have named an accomplice, which Societe Generale has not denied. From little acorns mighty crashes grow, and Kerviel with as yet unconfirmed help all but wrecked the venerable banking giant, hithertoo seen as boringly safe.
How could it have let a junior take out trading positons of 50 billion euros? The near five billion total loss could have been much worse without government help, and the share price dive has left many investors burned.
Such is the scale of the banking scandal, Europe’s biggest-ever, it may on its own have triggered a run on European markets last Jaunuary.
Outgoing Societe Generale boss Daniel Bouton has taken a step back and a clean pair of hands comes in to run the company on Tuesday, Frederick Oudea. He is symbolising what the bank calls a “new generation” at the top.