Paris - French bank Caisse d'Epargne said Thursday it lost 2 billion euros (2.57 billion dollars) in 2008 due primarily to huge losses incurred by its investment bank subsidiary, Natixis.

Earlier Thursday, Natixis reported a loss of 2.8 billion euros for 2008 because of its exposure in the US subprime crisis.

Caisse d'Epargne said that the Natixis loss cost the bank 1.6 billion euros in turnover, which totalled 2.2 billion euros before taxes.

The loss had been widely expected. Because of the weakness of the banking sector, President Nicolas Sarkozy has worked to force a merger between Caisse d'Epargne and Banque Populaire, which is joint parent company of Natixis.

Banque Populaire had earlier announced a loss of 468 million euros for last year.

The merger, which would create France's second largest bank, is expected to be announced later on Thursday. (dpa)