Groupe Caisse d'Epargne, the French customer-owned bank in merger talks with Groupe Banque Populaire, reported a 600 million-euro ($807 million) loss on equity derivatives after stock markets plunged last week. The loss occurred at the proprietary-trading business of Caisse Nationale des Caisses d'Epargne, the lender's holding company, the Paris-based bank said in a statement today. Caisse d'Epargne and Banque Populaire started merger talks last week, with the encouragement of the French state, as the global financial crisis puts pressure on banks to combine. The lenders are the main shareholders of Natixis SA, the Paris-based investment bank that piled up about 3.9 billion of writedowns tied to the U.S. subprime mortgage market collapse by June 30. European stocks last week slid 22 percent, driving the Dow Jones Stoxx 600 Index to its worst week on record, on concern the deepening credit crisis will push the economy into a recession. The equity derivatives losses don't affect the ``financial solidity'' of Caisse d'Epargne, which has more than 20 billion euros of shareholders' equity, the company said. Caisse d'Epargne and Banque Populaire formed Paris-based Natixis in 2006 by merging their investment-banking and asset- management businesses. They own about 34.5 percent each in Natixis and agreed on Sept. 29 that they may raise their holdings by as much as 2 percent each. http://www.bloomberg.com/apps/news?pid=20601087&sid=a1GS0eoHSnY0&refer=home Did Jerome Kerviel found a new working place ?
Bet the investment bankers 'wined and dined' these guys to a teat. Monaco Grand Prix, Arc, Champions League final etc.