Industrial Bank: EUR 4.9 billion fraud trader or facing bankruptcy.

<P> Keywords: Societe Generale trader fraud, consumer losses to create shape </ P> <P> Related News: </ P> <P> <P class = MsoNormal style = MARGIN: 0cm 0cm 0pt; LINE-HEIGHT: 150 .%; TEXT-ALIGN: left; mso-pagination: widow-orphan align = left> the huge loss of the Industrial Bank: Prime Minister said the economy had no effect on the law <? xml: namespace prefix = o ns = urn: schemas-microsoft-com: office .: office /> <o:p> </ o: p> </ P> <P class = MsoNormal style = MARGIN: 0cm 0cm 0pt; LINE-HEIGHT: 150%; TEXT-ALIGN: left; mso-pagination: widow .-orphan align = left> <o:p> </ o: p> </ P> <P class = MsoNormal style = MARGIN: 0cm 0cm 0pt; LINE-HEIGHT: 150%; TEXT-ALIGN: left; mso-pagination .: widow-orphan align = left> France Societe Generale Bank: fraud could have been avoided <o:p> </ o: p> </ P> <P class = MsoNormal style = MARGIN: 0cm 0cm 0pt; LINE-HEIGHT: 150% .; TEXT-ALIGN: left; mso-pagination: widow-orphan align = left> <o:p> </ o: p> </ P> <P class = MsoNormal style = MARGIN: 0cm 0cm 0pt; LINE-HEIGHT: .150%; TEXT-ALIGN: left; mso-pagination: widow-orphan align = left> Industrial Bank of huge loss: max shadow than bankruptcy <o:p> </ o: p> </ P> <P class = MsoNormal style .= MARGIN: 0cm 0cm 0pt; LINE-HEIGHT: 150%; TEXT-ALIGN: left; mso-pagination: widow-orphan align = left> <o:p> </ o: p> </ P> <P class = .MsoNormal style = MARGIN: 0cm 0cm 0pt; LINE-HEIGHT: 150%; TEXT-ALIGN: left; mso-pagination: widow-orphan align = left> </ P> France's second largest bank Societe Generale disclosed yesterday, because its a .were ultra vires in private investment trader derivatives, so the bank suffered 4.9 billion euros (7.16 billion U.S. dollars) for the huge losses. .Allegedly, this is the largest ever amount of traders involved in fraud. .</ P> <P> a huge amount of fraud that was caused concern about French President Nicolas Sarkozy, the regulatory authorities have initiated this investigation. .Even worse, dragged down by the U.S. subprime mortgage crisis, the bank also additional provision of 20.5 billion euros of asset losses. .In order to ease the financial difficulties, the Industrial Bank of emergency declared by way of issuance of allotment to refinance 5.5 billion euros. .The bank also said that does not exclude any merger or acquisition proposals. .</ P> <P> disaster from stock index futures </ P> <P> e-statement according to Societe Generale, the bank discovered last weekend, a trader in Paris, without the establishment of positions, and in the case of a large number of unauthorized .Investment in European stock index futures. .In fact, the Industrial Bank had been found in 19 of these "massive fraudulent transactions", however, have to wait until the bank closed all of the relevant position only after public disclosure. .The unwinding of these positions led directly to the bank up to 49 billion euros of losses. .</ P> <P> alleged that the dealer was quite old to use a large number of virtual transactions to hide their illegal investment behavior, more deadly is that employees use their work experience in the Industrial Bank, easily deceived .The bank's security system. .Traders involved have admitted his misconduct, and the related dismissal procedures "has been launched", Societe Generale also raised its legal proceedings, the relevant departments who will be directly responsible for leaving. .Fraud came to light, Societe Generale chairman and president of Bouton (Daniel Bouton) has submitted his resignation, but the board rejected his request. .This incident the bank has a public apology to all shareholders. .The Industrial Bank of fraud may also set a new world record, is the single largest amount of traders involved in fraud. .Prior to the Societe Generale, Bank of Bahrain has maintained the records. .In 1995, the Singapore subsidiary of an investment manager in the investment when the Nikkei futures misjudged, leading to loss of 1.4 billion Bank of Bahrain, this has more than 200 years old history of this Bank of England also had to declare bankruptcy. .Just last year, France's biggest retail bank Credit Agricole also had a similar case of fraud, which a trader in New York, unauthorized transactions, to bring 25 million euros in losses. .After the announcement, the Industrial Bank listed on the Euronext stock yesterday was an emergency suspension. .The day before, the stock fell 4.1%, to 79.08 euros, for the May 2005 the lowest point since the total market capitalization of approximately 350 million euros. .Societe Generale may be because investors expect the provision for more subprime-related losses, the bank's share price this year has tumbled 20%. .</ P> <P> € 5.5 billion of emergency financing in addition to accidental loss of EUR 4.9 billion, the Societe Generale also revealed a huge amount of "expected" losses, that is associated with the assets of the subprime crisis provision. .According to the latest data, Societe Generale has provision for 20.5 billion euros in subprime-related losses, including 1.1 billion euros and the U.S. subprime mortgage market-related assets, 550 million euros related to U.S. bond insurers and 400 million euros of assets other .loss. .Societe Generale said fraud and loss involved in the provision, the company's net profit last year fell to 600 million to 800 million euros between. .In the third quarter of last year, Societe Generale announced 3.75 billion euros in write-downs and trading losses. .Up to now, the bank mortgage-backed securities investment in the field of about 35 million euros. .In order to bridge the financing gap, Societe Generale announced yesterday, will be through the issuance of allotment of the way, 5.5 billion euros of emergency financing. .The bank said the financing plan is to maintain capital adequacy ratio. .At the same time, the company also announced it will introduce a bill to raise the efficiency of the entire Group's global program, the first step is to close its Australian subsidiary of asset securitization. .</ P> <P> exposed in the accident after huge losses, Fitch lowered its credit rating on Societe Generale. .Bouton, chairman, said the bank would consider any merger or acquisition from the external recommendations, but this is not the current priority, and any proposal must be consistent with the interests of shareholders. .French financial markets may face bankruptcy analysts believe that was the subprime mortgage crisis and financial fraud cases double blow of the Industrial Bank must now find 5.5 billion euros (80 billion U.S. dollars) in new capital injection, or bankruptcy can only be faced with a thorough .outcome. .European financial analysts also worried that this incident will not only France's second largest bank into an absolute crisis, but also lead to France and Europe's banking and financial turbulence, and thus to the global economic downturn worse. .</ P> <P> French President as the case shocked the market value of Societe Generale is the second largest bank in France, the French regulatory authorities on the incident has also been given attention. .French central bank and Finance Ministry have been involved in the incident investigation, and the French president made this statement. .While French President Nicolas Sarkozy declined to comment on this event too, but he also said that Industrial Bank is the victim of fraud. .French Prime Minister, the World Brand Lab (brand.), said Industrial Bank's situation is quite grim, but he denied that the incident would bring a broader range of economic impact. .Little information </ P> <P> leading French bank Societe Generale banking group headquartered in Paris, and listed companies in Paris, Tokyo, New York Stock Exchange. .French bank Societe Generale is the world's largest banking group, 31 December 2000 the market value of its stock in Paris than 300 million euros. .December 2000 long-term debt rating to "Aa3" (Moody's), and "AA-" (Standard & Poor's). .French bank in the world with 500 million private and business customers in 80 countries around the world with 500 branches, about 50% of the shareholders and 40% of its business from overseas. .</ P> </ p>.