French minister denies early knowledge of SocGen woes

PARIS (Reuters) - French Economy Minister Christine Lagarde only knew about the trading scandal at Societe Generale a day before it was made public and not the weekend before as suggested by a French radio station on Tuesday.

Europe 1 radio, citing a source close to SocGen, said Lagarde was informed of SocGen's troubles on Sunday January 20, three days ahead of the rest of the government, and the same day as the Bank of France and the market regulator, the AMF.

"That's totally false. We categorically deny it. I can tell you that she knew on Wednesday, January 23 in the morning," a spokesman for Lagarde said.

A later statement said she was told at 8 a.m. (2 a.m. EST), in a phone call with SocGen boss Daniel Bouton.

Lagarde herself said on LCI television on Tuesday she was told on Wednesday morning along with the rest of the government. She said this was also the same day as President Nicolas Sarkozy found out.

However, a source in Sarkozy's office told reporters in India over the weekend he was informed on Tuesday evening.

Bouton said he told the Bank of France governor Christian Noyer and the financial markets regulator, the AMF, on Sunday.

A source close to the matter told Reuters Sarkozy was angry with Noyer for not having told him earlier about the bank's woes.

Noyer said on Monday he had decided keep the information from the government before Wednesday because of the risk of leaks which could have jeopardized SocGen's efforts to quickly unwind the trades.

Lagarde told LCI she was awaiting clarification.

"I hope to be able to understand the reason why the governor of the Bank of France did not warn us between the Sunday and the Wednesday morning. I don't doubt that there were good reasons for him not to have done so ... I am awaiting explanations."

She said she will present her report to Prime Minister Francois Fillon on how the scandal unfolded on Monday.

Lagarde met with Noyer, AMF President Michel Prada and AMF Secretary General Gerard Rameix on Tuesday to discuss the SocGen case.

The question of who was told what and when about the stock trading by rogue trader Jerome Kerviel that led to 4.9 billion euros of losses, has been the subject of much speculation.

Market players have wondered why it took the bank and the country's regulators so long to identify the SocGen problem. Several government officials have complained that they should have been informed earlier.

Market analysts have also questioned whether the SocGen selloff played a crucial part in the sharp falls seen in world markets at the start of last week -- a drop that helped convince the U.S. Federal Reserve to slash its rates on Tuesday.

The Fed said it did not know about SocGen's woes when it made its decision. Noyer has rejected speculation that the unwinding of SocGen positions influenced the Fed.

(Reporting by Anna Willard; Editing by David Holmes and Elizabeth Fullerton)