In back-to-back board meetings that ended late Tuesday night, both Societe Generale and Paribas's boards described as "hostile" BNP's all-share $37 billion attempt to take over both banks and vowed to press ahead with their own agreed $17.2 billion merger. At the same time, however, Societe Generale left its all-share offer for Paribas unchanged, despite market speculation that it would sweeten its bid. The expected rejection of BNP's bids, which would create the world's largest bank in assets, sets the stage for what is likely to be a protracted stock-market battle as both sides try to convince investors that their plan creates more value. Societe Generale and Paribas are likely to harden their resolve to avoid the negotiated outcome to the battle that France'sgovernment and central bank have called for.

The Wall Street Journal the spokeswoman added, "BNP remains open to dialogue, and if there is none, the markets will decide."

In Paris trading Tuesday, BNP shares lost 1 per cent closing at 79.20 euros ($84.20), while Paribas shares fell 0.48 per cent, closing at 103.40 euros, and Societe Generale shares rose 1.12 per cent, closing at 180.40 euros.