French banking group Societe Generale has decided to set aside €2.3bn to settle various disputes with regulators. The bank could not determine the precise financial impact of the disputes as of now.
“Although the financial impact of the disputes cannot be determined with certainty, as of 31 December 2017, the bank has booked in its financial statements a provision for disputes for €2.3bn, in compliance with IFRS standards,” the French lender said in a statement.
Of the provision, roughly €1bn has been set aside to settle Libor rate rigging charges and transactions involving Libyan counterparties.
The bank has currently started active talks with the US Department of Justice and the Commodity Futures Trading Commission over the two disputes and hopes to reach a settlement in the coming weeks.
The global U.S. dollar Libor rate rigging allegations have been haunting Societe Generale since the past year, with various senior managers caught up in the probe.
These include the bank’s former global head of treasury Danielle Sindzingre and its former head of Paris treasury desk Muriel Bescond, who were accused of submitting false information about the bank’s borrowing expenses.
Earlier this month, Societe Generale deputy CEO Didier Valet resigned abruptly.
The bank cited “divergence of approaches regarding the management of a specific legal matter” as the reason for Valet’s departure.
However, according to media reports, the resignation was due to Valet falling out with Frederic Oudea over how to handle the interest manipulation allegations with regulators.
Societe Generale had a tryst with controversies in the recent times. In January 2017, the bank agreed to a $50m settlement to resolve claims that it defrauded investors in the marketing and sale of a residential mortgage-backed security (RMBS).