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THE EFFORT TO MINIMIZE RISK

Actually, the bank had begun the effort to minimize risk in 2001, a year after Kerviel was hired. On December 5, 2001, SocGen announced it had implemented Enterprise Application Integration (EAI) solutions from Tibco Software, the Palo Alto, Calif.-based integration software company. According to the news releases sent out by Tibco, the EAI solutions would "help minimize risk, save money and provide a better financial return to Societe General clients."

The integration software was initially used for an integration project within the Debt Finance Group. Soon after, the bank's IT Risk Department followed suit.

With bank traders who worked for both the corporate and investment banking divisions of SocGen using many diverse systems, EAI allowed data to be collected from the bank's offices worldwide and fed to risk managers who could use that information to calculate "the global risk for market operations such as commodities, credit and exchange," according to a Tibco-produced case history.

Working with Jerome Grelier, the architect and director of the project from OCTO Technology, a Paris-based company that provides systems administration management, development and distribution of software, and the bank's IT risk department, Tibco replaced numerous point-to-point connections within the global bank as well as with its BusinessWorks software, a legacy scheduling system.

The bank also used Tibco solutions to streamline SocGen development and maintenance, implementing a service-oriented architecture (SOA). Under SOA, functional components or services were re-usable. "Different applications of the bank's Risk Information System...can all connect to the data-gathering service and share the same functional logic," Fabrice Beral, a SocGen risk management project manager, noted in the news release detailing the Tibco contract.

The release described the implementation as involving, "the integration of many diverse trade capture systems. Initially located in New York, the system integrates Societe Generale's global trade positions to accelerate and improve their management information systems (MIS) functions from risk calculations to client relationship or cash management. Some of the benefits for Societe Generale in deploying the Tibco solution include: the ability to transfer ownership for data quality to its initial sources, enhanced scalability to handle expected volume increases through use of parallel processing, and the establishment of a standard infrastructure for supporting similar functions worldwide."

Tibco declined to comment on this story as did SocGen.