The €5.5 billion SocGen (OTCPK:SCGLY) rights offering has received more than €10 billion in demand, putting to rest any doubt about the bank's ability to survive the Kerviel crisis - and also proving that banks have more options than simply running in desperation to sovereign wealth funds if they find themselves hard up for capital. Or, perhaps, proving that French banks have a brighter future than their U.S. cousins.
SocGen's response to its capital needs makes a certain amount of sense. When the credit markets are in turmoil and the stock markets are relatively healthy (emphasis on the "relatively"), then a bank in need of capital should raise equity rather than debt, no? Especially if the bank is going to end up diluting shareholders either way.