Less than a year after Jérôme Kerviel’s exploits at SocGen made the headlines, it is now another French banking group, Caisse d’Epargne, that is reporting a violation of its internal rules leading to  a €751-million loss related to derivatives trading. Traders allegedly exceeded their limits, internal controls have failed, and charges have been pressed. Sound familiar?

The main difference with the Kerviel story so far, aside from the amount of the loss, is the immediate resignation of the bank’s top management. While SocGen moved some top brass around, they did not leave the group. To be fair, the general context is quite a bit worse today than it was when the SocGen scandal broke. Had it happened today, among general mistrust for the banking sector, I am not sure SocGen chairman Daniel Bouton would have been able to stay on.

Filed under: Credit Crunch, risk, Securities & Capital Markets