Thursday, January 24, 2008

Oh please!………….. What is the French for

SocGen uncovers €5bn fraud

The Dog ate my homework. It was a rogue trader, that's it. It wasn't my signature on those trades.
Europe’s battered banking sector was dealt a fresh blow after Société Générale, France’s second-largest listed bank, said it had uncovered a fraud by a single trader, forcing it into an emergency €5.5bn share issue. Daniel Bouton, SG’s long-standing chief executive and chairman, had an offer to resign turned down by the bank’s board

Posted by lvmreader @ 09:47 AM (1670 views)
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17 thoughts on “Oh please!………….. What is the French for

  • Any we give these guys bonuses?

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  • The french for risk management is “gestion du risque” ! ;-)))

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  • Whoopsie:

    The colossal losses include a writedown of €2.05bn on its structured credit activities related to investments in the US mortgage market.

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  • little professor says:

    Yikes. To put this into perspective, rogue trader Nick Leeson who caused the collapse of Barings Bank only lost £837 million.

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  • disillusioned says:

    This won’t be the last fraud to be uncovered from this mess, I’m sure.

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  • is it a “fraud” i wonder??? – if unauthroised trading then it depends on whether it was for personal financial gain or not. If it was a punt on the DAx or more likely CAC – either wrote puts or bought futures then – unless they have a specific rouge trader policy this wont be covered by Commercial Crime insurance. If it was for personal gain -eg he put the trades in his own account then put them back into Soc Gens when it went tits up, then it would be covered by the Crime policy – C’est la vie!!!!

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  • Another of the many problems that seem to have occurred from allowing traders, brokers and bankers to have a light touch “self regulating” regime.

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  • Actually, Leeson only really lost about £400m on the books, but when it was uncovered, the market gang-raped Barings ballooning the losses to £837m, I think.

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  • oh by the way “Risk Management” in French is “C’est les Rosbeef a blamer”

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  • Apparently, JPMorgan and Morgan Stanley bailed them out.

    This implies those naughty Americans had sold them something they shouldn’t have.

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  • haha this FT report Risk magazine voted SocGen the equity derivatives house of the year.

    “With one of the largest exotics books on the Street, one would imagine that Société Générale Corporate and Investment Banking (SG CIB) would be licking its wounds and coping with hundreds of millions of euros in losses. There was some impact, but the losses have been relatively minor and entirely manageable, says Christophe Mianne, SG CIB’s head of market activities, covering equity, derivatives, fixed income, currency and commodities in Paris.

    “We managed the existing book very well because we decided some time before the crisis to be long volatility and be less sensitive to correlation, so the losses were minimal. We suffered on our statistical arbitrage trading activity, but that was just for one month, and minimal compared to some hedge funds or other banks. Overall, our trading activities will be approximately flat compared to last year, which is a good performance,” remarks Mianne.”

    lol

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  • David Smith's Sub Prime. . . says:

    And if they had been successful?

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  • Here is a pic of the naughty man courtesy of FT blog

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  • 31-year-old banker Jerome Kerviel.

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  • Cant wait to see his Parisian Shrug when he gets interviewed oh la la la la

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  • who stole my pension? says:

    No matter if it was 800 or 400mln that Nick Leeson lost, he still looks like an amateur compared to this guy!!

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  • Anton Kleinschmidt says:

    As a retired 60 year old banker I read about subprime and the Socgen debacle with smug amusement. I predicted something akin to the current meltdown 15 years ago but was dismissed as being too conservative. The global economy is now paying a very heavy price for allowing 20 years of unregulated rampage by the MBA crusaders. The days when bankers were expected to have a sound personal appreciation of risk are long gone and instead we now have large numbers of prima donnas with little real understanding of risk earning huge salaries and structuring all sorts of high risk assets which most financial CEOs and the regulators do not even understand. One thing is clear, the fun and games are only just starting

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