(BRUSSELS) - The French government's determination to protect troubled bank Societe Generale from foreign buyers is raising concern, though not surprise, in Brussels.

While France is anxious to find a friendly French suitor for Societe Generale, the European Commission and others have been "metaphorically waving the rule book" and calling for a level-playing field for all European bidders, one analyst noted.

Societe Generale is fighting to discourage potential takeover bids and raise 5.5 billion euros in fresh capital after announcing losses of 4.8 billion euros (7.1 billion dollars) it blamed on rogue trader Jerome Kerviel.

"The French government protectionism is operating at a high level," said Grace Annan, France analyst for Global Insight.

"Behind the scenes it is frantically looking for a friendly takeover bid."

She said the prefered option for Paris would be splitting up Societe Generale, with national rivals BNP Paribas taking over its branch network and Credit Agricole acquiring the investment banking operations.

"I think the EU is quite used to France's very protectionist stance," Anan told AFP.

"What might put more pressure on the French government... (are) questions about the capacity of BNP Paribas and Credite Agricole to actually fund these takeovers. Already the whole French banking system has taken quite a hit because of Societe Generale."

BNP Paribas last week revealed that it was indeed weighing a bid for its stricken competitor.

"We are thinking (about it), simply because all of Europe is thinking about it," a BNP Paribas spokeswoman said.

French Prime Minister Francois Fillon had earlier served notice to potential foreign bidders that they would be unwelcome when he told parliament that Societe Generale should remain a "great French bank."

"The government will not allow Societe Generale to be the target of hostile raids by other banking establishments," he said.

Britain's HSBC and Barclays, Germany's Deutsche Bank, Spain's Banco Santander and Italy's UniCredit have all been cited as potential suitors.

Senior advisor for French President Nicolas Sarkozy, Henri Guaino, was especially blunt.

"We will not leave this company at the mercy of any old predator," he has said adding that "every time there is an attack on the banking system, every government in Europe is active, they intervene, they never stay indifferent, France is just like the others."

Such comments not surprisingly raised hackles at the European Commission, which monitors competition questions in the European Union.

"The same rules apply as in other takeover situations under free movement of capital rules," spokesman Oliver Drewes retorted on behalf of EU Internal Markets Commissioner Charlie McCreevy.

"Potential bidders are to be treated in a non-discriminatory manner," he added.

The president of the Eurogroup of eurozone finance ministers, Luxembourg's Jean-Claude Juncker, tried to instill some free market logic to the argument.

"I would fully understand the wish to exclude from the game those who nourish hostile feelings towards France and Societe Generale," Juncker told Europe 1 radio.

But "if someone friendly comes forward with a strong economic project to offer, why refuse it? Simply because it is not French?" the Luxembourg prime minister added, arguing that such an attitude was "no longer of our time."

The French stance is reminiscent of the furore surrounding another takeover bid, when Italian electricity group Enel's interest in French water, utility and sanitation company Suez in early 2006 prompted Pris to support the creation of a "national champion" by coupling Suez with France's state-controlled gas supplier GDF.

Explaining the logic behind the GDF-Suez deal as far as Paris was concerned, Fillon said it was necessary to ensure that GDF, which is controlled by the state, remained a "major actor."

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