How did a young, obscure trader become the key figure in mighty Societe Generale’s $7-billion loss? And who is this guy?

Huddled over lunch Friday at a bistro on the Champs- Elysees, two young bankers wondered about the double life of Jerome Kerviel, the rookie trader with French bank Societe Generale who is accused of the largest fraud in banking history.

How could Kerviel hide his lies, the HSBC man asked his friend, who works in Societe Generale’s glass-tower headquarters on the rim of Paris.

How could he elude so many levels of controls and cause his bank $7.2 billion in losses?

“He’d have to keep checking just at the right moment,” the HSBC banker speculated. “He must have never left his computer screen. Not even to eat.”

Around Paris and among financial workers around the globe, many marveled: How could one rogue rack up so many billions in losses without anyone knowing? And who is this guy anyway?

Mostly he appears to be a game warden turned poacher, a young man trained at the nondescript schools of France’s second cities, in Nantes and Lyon, to monitor the billions in trades banks execute every day. Then he apparently used his intimate knowledge of how a bank protects itself to engage in unauthorized trades and evade detection.

As far as anyone can tell, Kerviel didn’t do it to steal money. He did it, apparently, because he could.

But there remained many unanswered questions Friday, and Kerviel wasn’t talking. A sign on the mailbox of his posh Neuilly-sur-Seine apartment, a short walk from his office, said: “Don’t search here. He has been seeking refuge elsewhere probably for some time now.”

In the charming village in Brittany where Kerviel grew up, a few hours from Paris, a neighbor told Reuters that his mother, a retired hairdresser, had rushed off to the capital to join her son, “who wasn’t doing well.”

Neither was his former employer. Societe Generale stock was downgraded Friday by UBS and Deutsche Bank.

Kerviel’s job entailed hedging the bank’s trading positions in European stocks with stock index futures. This involves making countervailing bets on which way stocks will move as an insurance policy to protect the bank’s portfolio.

On Friday, bank executives told reporters that Kerviel might have been gambling “tens of billions of euros” in unauthorized trades, far more than initially thought.

A week ago, he apparently made a small error and tripped a security wire. By last Saturday night, he was apparently helping the bank retrace his trail of fraud, according to a source inside the bank.

French police searched Kerviel’s home Friday for more than two hours, according to the Associated Press, and then left with two large black leather cases and one briefcase.

Societe Generale says Kerviel didn’t profit personally from his trading and that he was acting alone, most likely to prove himself. Some financial experts had a hard time buying that.

“If you work in banks, you know that when losses are that big the bank cuts off positions,” said Mark Touati, an economist at Global Equities. “They can reach a few hundred million. But billions . . . ?”

On television talk shows, such skepticism was also widespread -- and perhaps laced with a sense that this vaunted, elite bank, started under Napoleon III, had gotten its comeuppance.

“You’re not going to entrust a person who earned that little -- 100,000 euros [about $146,000] a year -- with such extremely important portfolios?” exclaimed one analyst. “Impossible!”

Kerviel’s resume, which circulated on the Internet on Friday, provided little more than a stick-figure portrait of the man: He liked judo and sailing, he spoke English and he had computer programming skills.

But apparently this young Parisian with the knitted brow and faint resemblance to Charlie Sheen in an internal bank photo was capable of much more.

In France’s hierarchical society, Kerviel was from the second tier. He was not a graduate of France’s Grandes Ecoles, the state-funded schools that produce the nation’s managerial and political elite.

Rather, he holds a bachelor’s degree in finance from the University of Nantes and a master’s degree in organization and control of financial markets from the University of Lyon II.

Valerie Buthion, director of the Lyon school’s engineering and finance department, said Kerviel was remembered as a bright-enough student; capable but not extraordinary, not a big man on campus. She had been surprised, she said, to read in the local papers that he was described by a banking official as a “computer genius.” She was also baffled about how he had ended up a trader.

“Our students are trained to be administrative, to control the market, not to play with it,” Buthion said.

After graduation in June 2000, at age 23, Kerviel joined Societe Generale. After developing and learning procedures to control the positions that traders across the bank could use, he became one himself in March 2004, trading in index futures in euro-zone stocks on a desk known as Delta One.

Two years later he was allegedly making “fake” counterbalancing trades, or bets designed to hedge losses in one stock index with gains in another. He eluded detection with the help of information and, some French observers suggest, connections he’d made while working his way up in the back office.

Societe Generale’s human resources director told the tabloid Le Parisien that Kerviel was a “fragile person” “without any particular genius” who was going through “family difficulties.”

That may have included the death of Kerviel’s father, a local blacksmith, according to reports. Others anonymously informed newspapers that Kerviel was shy, introverted, even “socially awkward.”

Ed Shing, a young banker himself at a big Paris bank, wasn’t quite buying all the armchair psychoanalysis.

“It’s always like this,” said Shing, chuckling. “All the initial question of why. I guess it seems all the more unbelievable when this normal person, really quite boring person, concocts on this scale.

“But maybe he just wanted to keep his job,” said Shing, unable to keep himself from the game of analysis. “And, well, these trades looked good.”

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geraldine.baum@latimes.com

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Special correspondent Devorah Lauter contributed to this report.