BNP Paribas rules out SocGen bid

BNP Paribas said market conditions were unfavourable

French bank BNP Paribas has ruled out a potential merger with troubled rival Societe Generale.

There has been prolonged speculation BNP Paribas would bid for SocGen after it suffered significant losses, blamed on a former trader, Jerome Kerviel.

BNP Paribas said current market conditions meant a merger would not be profitable for its shareholders.

Mr Kerviel, who is accused of losing his employer 5bn euros ($7bn; £3.5bn), was released from custody on Tuesday.

"Given the persistent rumours, BNP clarifies that it has ceased to consider a potential tie up with Societe Generale," the firm said in a statement.

Several years ago, the French government had tried to encourage such a merger to prevent any major French banks being taken over by foreign firms.