The French Prime Minister said that there was “no reason” to be worried about the health of Société Générale, the country’s second-largest bank, which revealed a €5 billion fraud today.

Speaking from Davos, François Fillon, said: “I note … that despite this fraud, Société Générale has a positive report. I see that it has taken serious measures to cope with the situation.

He added: “I note too that the Bank of France has indicated that there is no reason to have any worries about the health of this bank and I am happy with that.”

Christian Noyer, the Governor of the Bank of France, will make a statement at 1.30 today.

It emerged this morning that Société Générale had been the victim of one of the largest frauds by a rogue trader, losing €4.9 billion (£3.7 billion) as a result of a Paris-based trader who concealed his positions through "a scheme of elaborate fictitious transactions".

SocGen was forced today into an emergency €5.5 billion capital-raising to shore up its ravaged balance sheet.

Mr Fillon, who is co-chairing a session at the World Economic Forum in Davos titled France on the Move, said: “Société Générale has had to face up to a very large fraud. It is a serious business but, at the same time, it has nothing to do with the current situation on the global financial markets.”

Société Générale also announced further writedowns of €2.05 billion related to the global credit crunch.

Daniel Bouton, the chairman of the bank, who offered his resignation yesterday, which was rejected, said that the trader, who managed to “escape all control”, had been suspended and that legal action would be taken against him.

Mr Bouton also said that the bank was also dismissing top executives “responsible for the supervision and controls on the operations concerned”.

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