The French national bank regulator still hopes for an agreed solution to the continuing battle between Societe Generale and Banque National de Paris, a source close to the Committee of Credit Establishments and Investment Enterprises said yesterday.
"The CECEI is expecting both sides to make an effort towards an agreed solution," the source said, warning that for the moment "neither bank's argument is convincing".
The regulator has been called in to resolve matters after almost six months of acrimony in the French banking sector ended inconclusively. BNP only partially succeeded in its double hostile bid for rivals enerale SocGen and Paribas, winning control of Paribas but not SocGen. But this scuppered SocGen's rival plan for a two-way merger with Paribas.
Neither side is willing to concede defeat, with BNP saying it can claim minority control with less than 40 per cent of SocGen and the latter saying the three-way merger is now "impossible" and asking the regulator to forbid BNP from taking up its minority stake.
The CECEI met late on Tuesday for the first time to consider the problem, but said only that it would meet again next week to make a decision. It has to authorise any stake of more than 10 per cent in a bank, so it must decide whether BNP can keep the 36.8 per cent stake in SocGen it won in the take-over bid, and whether it can claim control.
The regulator wants to see both banks "make an effort" to find "some common ground" and "put an end to the disorder" in the banking sector caused by their battle, a source said.
