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SocGen Pounded on Losses and Revelations

The bank's record fourth-quarter loss and fresh questions about its internal controls increase pressure for a management shakeup

Société Générale's (SOGN.PA) share price took another hammering on Feb. 21, falling nearly 9% in Paris trading as it reported a record $4.9 billion fourth-quarter loss from rogue trading and U.S. subprime write-offs. Even as the big French bank launched an $8 billion capital increase to regain its financial footing, a new investigation report raised fresh questions about its failure to act on warnings about Jérôme Kerviel, whose unauthorized trades cost the bank more than $7.1 billion.

Late on Feb. 20 a committee appointed by SocGen's board released the most-detailed—and the most damning—accounting so far of the rogue trading scandal. According to its preliminary report, the bank's internal control system generated 75 alerts about questionable trades by Kerviel, starting in 2006.