Societe Generale chief exec Bouton comments on fraud, shots of bank

Описание: (24 Jan 2008) SHOTLIST
1. Various exteriors of Societe Generale building
2. SOUNDBITE: (French) Daniel Bouton, Societe Generale chief executive:
"Last Saturday, we discovered the existence of a concealed activity, totally hidden, outside of our books, but existent in our market activities. This activity, concealed and hidden, was of an enormous size and was running considerable risks to the bank and to a lot of operators."
3. Various cutaways
4. SOUNDBITE: (French) Daniel Bouton, Societe Generale chief executive:
"It was through an extraordinary stroke of bad luck that this activity was uncovered quickly in context of the markets' fall initiated by the Asian markets' fall. What is amazing is that the Societe Generale group is so strong that - despite the extraordinary fraud - we will have a positive result of several hundreds of millions euros for the end 2007. The situation was very solid, we didn't have solvency problem, even after this fraud."
5. Various cutaways
6. SOUNDBITE: (French) Daniel Bouton, Societe Generale chief executive:
"Of course I presented my resignation to the administrative council. The administrative council deliberated and decided not to accept my resignation and reiterated its confidence in myself and in the business model we have built over the years. They asked me to confront this difficult situation and put the group back in a profitable growth position."
7. End of presser
STORYLINE
French bank Societe Generale said Thursday it has uncovered a 4.9 (b) billion euro (7.14 (b) billion US dollar) fraud, one of history's biggest, by a single futures trader whose scheme of fictitious transactions came undone when stock markets plunged this week.
Executives said the trader, a French man in his 30s, acted alone.
CEO Daniel Bouton said the man's motivations were "irrational" and said he may not have benefited directly from the fraudulent deals.
"Last Saturday, we discovered the existence of a concealed activity, totally hidden, outside of our books, but existent in our market activities," Bouton told a news conference.
Bouton said the fraud was found out after the sharp declines on world markets began late last week, as the trader rushed to close fraudulent
positions.
"It was through an extraordinary stroke of bad luck that this activity was uncovered quickly in context of the markets' fall initiated by the Asian markets' fall," he explained.
Societe Generale said, in a statement, it detected the fraud - comparable to a full year of the bank's profits in stable times - at its French markets division the weekend of January 19-20.
It said the trader had misled investors in 2007 and 2008 through a "scheme of elaborate fictitious transactions."
The trader, who was not named, used his knowledge of the group's security systems to conceal his fraudulent positions, the statement said.
The man admitted to the fraud, the bank said, and was being dismissed. His supervisors were to leave the group. Bouton offered his resignation but it was rejected by the board.
The CEO said that Societe Generale's administrative council "reiterated its confidence in myself and in the business model we have built over the years."
"They asked me to confront this difficult situation and put the group back in a profitable growth position," Bouton said.
The bombshell announcement destabilised a major bank already exposed to the subprime crisis.
France's second largest bank by market value said it would be forced to seek 5.5 (b) billion euros (8.02 (b) billion US dollars) in new capital.
However Bouton insisted that the bank's "situation was very solid."

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