Societe Generale posts 63% profit drop

Societe Generale posts 63% profit drop
France's second-largest bank takes hit from money-losing investment bank.

PARIS (AP) -- French bank Societe Generale SA said Tuesday net profit fell 63% in the second quarter, after its investment banking unit posted a loss.

Net profit dropped to $1 billion in the second quarter from $2.71 billion a year ago, SocGen said in a statement.

Continued turmoil in global financial markets led SocGen's corporate and investment banking unit to a $290 million loss, compared with a $1.12 billion profit a year earlier, the bank said.

SocGen is still managing the fallout from $7.18 billion hit it took closing what it calls unauthorized positions by former trader Jerome Kerviel. The loss was announced in January but included in the bank's 2007 results.

France's second-largest bank has tightened security and changed its top management this year, splitting the posts of CEO and chairman.

CEO Frederic Oudea, promoted from CFO in May, said the second quarter result "reflects the robustness" of the bank's portfolio of activities, despite what he calls "a crisis on an exceptional scale."

CNN