Societe Generale CEO Daniel Bouton won fresh support from the board today, as the bank set up a special committee under a former car executive to probe the world's biggest rogue trading scandal.
SocGen, keen to close ranks to fight off potential predator BNP Paribas, said it had set up a special committee of independent directors to ensure that the causes and impact of the losses were fully identified.
BNP Paribas refused to comment on market speculation of a bid for its wounded rival, nearly a week after SocGen disclosed €4.9 billion ($7.3 billion) of rogue trading losses.
The committee would ensure "that the causes and sizes of the trading losses announced by the bank have been completely identified," said the statement. Former PSA Peugeot Citroen CEO Jean-Martin Folz would chair the committee, SocGen said.
Under heavy political pressure to sack Mr Bouton, the 15-strong board has now twice backed the CEO, who offered to resign as soon as the bank uncovered risky positions, which it disclosed last Thursday.
Politicians from President Nicolas Sarkozy down have called for sweeping changes in the wake of scandal. Support for Mr Bouton ebbed back and forth yesterday when France's finance minister first appeared to call for him to quit, then changed her mind.
Mr Bouton, author of a blueprint on how to run a French company, has pledged the bank will bounce back from its humiliation over illicit bets worth $70 billion placed by 31-year-old trader Jerome Kerviel. But the scandal has shaken France's image of itself as a refuge against unfettered capitalism.
SocGen shares rose 10.4 per cent on Tuesday, spurred on by rumours that France's biggest listed bank might launch a bid for the weakened SocGen. Today, the shares edged up another 0.9 per cent to €79.14.
The speculation left the board with a dilemma over whether to drop Mr Bouton three years before the end of his mandate or avoid further upheaval that could deliver the bank to a predator.