Europe's recovery is real, BNP's CFO tells us

Europe's economy is showing signs of improvement and should lead to a more visible turnaround in the second half of 2013, the co-chief operating officer of French bank BNP Paribas (BNPP.PA) told Reuters Insider TV.


"We are seeing early signs of improvement but for me it will be more in the second part of the year," Philippe Bordenave said in an interview to present BNP's second-quarter results.

Commenting on the outlook for loan-loss provisions, he added: "We are relatively confident as far as France and Belgium are concerned...in Italy, it may be somewhat more difficult, given the recession."

French bank eyeing more deals in China's lucrative insurance market

PARIS, July 8 (Reuters) - BNP Paribas, France's No. 1 listed bank, has taken its first step into China's insurance market by buying Dutch bank ING's stake in a partnership with Bank of Beijing.

BNP is in the early stages of a plan to ramp up revenue and staff in Asia to offset recession in the euro zone, where it is heavily exposed.

ING, meanwhile, is having to shrink into a smaller, Europe-focused bank after it was bailed out by the Dutch government in the 2008 crisis.

The terms of the China deal were not disclosed, but BNP's insurance chief told Reuters on Monday that the joint venture represented 200 million euros ($257 million) in insurance premium income.

"We want to invest in this joint venture and will grow by adding clients, new products and eventually by making new partnerships," Eric Lombard said in a phone interview.

The deal, which has yet to be signed off by regulators, gives BNP a slice of the world's No. 2 insurance market and offers a route to cross-selling with other parts of the French bank, which recently raised its stake in existing partner Bank of Nanjing.

It also shows that top French banks like BNP and Societe Generale are stepping up their investments in China after focusing on more mature, developed banking markets in the past. SocGen last month opened its seventh mainland branch in northeastern China, near the Russian border.

However, smaller French rival Credit Agricole has been cutting its Asia exposure as part of a drive to focus on its home market in the wake of the euro zone crisis. It is in the closing stages of a deal to sell its CLSA Asian brokerage unit to China's CITIC Securities.

ING said in a statement that the sale of its 50 percent stake in the China venture would not have a "material" impact on group results or affect ING's own 13.7 percent stake in Bank of Beijing.

Currently, foreign banks are not allowed to own more than 20 percent of a Chinese lender. Canada's Bank of Nova Scotia said in May that Chinese authorities were reevaluating a proposed deal to sell 20 percent of Bank of Guangzhou to the Canadian bank.

Jerome Kerviel, still in Paris at a courtroom near you

By Lionel Laurent

PARIS, July 4 (Reuters) - A Paris employment tribunal on Thursday rejected former Societe Generale trader Jerome Kerviel's plea for a new expert inquiry to help overturn his dismissal in France's biggest-ever trading scandal in 2008.

In a separate criminal case, Kerviel is running out of options to escape conviction and a jail sentence upheld by an appeals court in October over 4.9 billion euros ($6.4 billion) in losses that French bank SocGen said were the result of unauthorized trades by Kerviel.

The 36-year-old ex-trader, who was ordered to repay the huge sum in its entirety, has never denied masking the 50 billion euros in market positions that went wrong as the financial crisis unfolded in early 2008. He has, however, always said his bosses knew what he was doing, an accusation SocGen denies.

Kerviel has asked the employment tribunal to overturn his dismissal and grant him 4.9 billion euros in damages but no new inquiry will now be opened.

Speaking to supporters and media outside the courthouse after the hour-long hearing, an unshaven and tieless Kerviel said he was disappointed but would keep fighting ahead of a final ruling by the employment tribunal, which could take months.

"I am disappointed, of course ... They've refused (my demands)," he said. "We will keep going."

Far-left groups and the popular press in France have painted Kerviel as a naive victim of big finance, despite his role before the case as a highly-paid trader. Dozens of supporters chanted slogans against SocGen and threw fake banknotes like confetti outside the court, also brewing coffee and serving croissants to the crowd.

SocGen's legal team issued a short statement saying Kerviel had been late in submitting several demands and that after a "lengthy debate" the employment tribunal had rejected them.

"Despite the media presence orchestrated by Jerome Kerviel, the legal system showed once again that it could remain clear-headed," it said.

Without a new inquiry, it is unlikely there will be any new elements brought to light that might help Kerviel's case, either before the employment tribunal or in the criminal proceeding.

LEGAL PARADOX
The former banker still has a chance of winning on some points, however, thanks to the technicalities of French employment law, argued Mabrouk Sassi, a lawyer who specializes in tax, business and employment law.

Under the terms of his dismissal, SocGen said he had wilfully sought to hurt the company, which may be successfully rejected, Sassi said. But even a victory for Kerviel in this case would only represent around 800,000 euros, barely a dent in the 4.9 billion due. He may also still face time in jail.

"The paradox is that SocGen could lose on the dismissal but win the criminal case," said Sassi.

Kerviel was flanked by his lawyer, David Koubbi, and far-left political firebrand Jean-Luc Melenchon, who compared the former trader to Alfred Dreyfus, a Jewish military officer and victim of anti-Semitism who was wrongfully charged with treason in the 19th century.

"This is a case of one individual against the financial world," Melenchon told reporters. "It is emblematic of the kind of world we are living in."

One of Kerviel's supporters, 60-year-old former secretary Sylvana Fauvet, said she viewed the ex-trader as a victim.

"I came to support (Kerviel)...They've already condemned him to death by making him repay the 4.9 billion," she said. "It's the bosses who are always responsible for what happens at a company, including when there are losses."