Siemens withdrew cash from Societe Generale

September 20, 2011

, PARIS, Sept 20 – German industrial giant Siemens transferred a large sum of money from Societe Generale to the European Central Bank, but not because of doubts on the safety of French banks, a source told AFP on Tuesday.

A source close to the matter said Siemens had placed a short-term investment at the Societe Generale and when the placement matured, decided to transfer the funds to the ECB where the deposit would perform better than if placed at a bank.

“This goes back to July,” before the results of the stress tests on European banks and before markets slumped on nervousness over the eurozone debt crisis, the source said in contradiction to a report in the Financial Times which said the withdrawal took place two weeks ago.

According to the report in the FT, also quoting a source with direct knowledge of the matter, Siemens withdrew more than 500 million euros ($683 million) from a large unnamed French bank and transferred it to the ECB.

It was a sign, the newspaper said, of how companies were seeking havens for their cash during the eurozone debt crisis.

Siemens withdrew the money partly out of concerns about the future financial health of the unnamed bank and partly to benefit from the higher interest paid by the ECB, FT said.

Siemens is only one of a handful of large companies that have a banking licence allowing them to deposit cash directly with the ECB.

Contacted by AFP, Siemens dismissed the FT report as “speculation”. Societe Generale and the ECB also declined to comment.

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