PARIS (Reuters) - The supervisory board of BPCE, France's second-biggest retail lender, confirmed that Chief Executive Francois Perol had been put under investigation to determine if his nomination to head the group in 2009 represented a conflict of interest.
The board pledged its unanimous support to the former aide to ex-French President Nicolas Sarkozy, however, whose term as CEO is due to run until late 2016.
"The supervisory board took note of this information and wanted to testify unanimously its confidence in Francois Perol," BPCE said in a short statement on Friday.
The appointment of Sarkozy's former economic adviser in 2009 as head of the newly merged regional banks Caisse d'Epargne/Banque Populaire (BPCE) aimed to prevent its Natixis
However, two trade unions pushed for an investigation into the nomination, as Perol had previously worked at investment company Rothschild & Cie, which played a key role in the merger that placed BPCE group in second place behind Credit Agricole
Perol faced questions from an investigating magistrate in a closed Paris courtroom on Thursday and was subsequently placed under judicial investigation, a source had told Reuters.
In France, executives under investigation do not have to step down from their posts.
Perol is not the only former high-ranking civil servant from Sarkozy's 2007-2012 presidency to face scrutiny.
Under Perol's leadership, Natixis has slashed its balance sheet, while restructuring efforts drove Natixis shares up more than 100 percent in 2013.
BPCE revealed a strategic plan late last year aimed at nearly doubling annual net profit by 2017.
Natixis CEO Laurent Mignon said in a January interview with Reuters that the investment bank had seen a turnaround under Perol's management.
Shares in Natixis were little changed on Friday, down 0.1 percent, versus a 0.4 percent uptick in the European banking index <.SX7P>.
(Reporting by Maya Nikolaeva; Editing by James Regan)