French bank admits trading loss

Caisse d'Epargne is in the process of merging with Banque Populaire

The French bank Caisse d'Epargne has admitted it lost 600m euros ($807m; £466m) in a derivatives trading incident last week.
In a statement, the bank said that the losses would not threaten its financial viability or affect its customers.
It blamed the extreme volatility in the markets in the week of 6 October for the incident.
Caisse d'Epargne announced on 8 October that it is to merge with another mutual bank, Banque Populaire.
The merger would create one of France's biggest banks with 480bn euros of deposits and more than six million customers.
The two banks together are the majority shareholders in the investment bank Natixis, which has been among the worst-hit in France by the US sub-prime mortgage crisis.
An unnamed Caisse d'Epargne official quoted by the AFP news agency said that a finance director from the group had been sacked and six members of the team that made the trades had been sanctioned.
Rumours of a big derivatives loss forced Societe Generale and Dexia to issue denials earlier in the week.