FIRE gutted the headquarters of the state owned French bank, Credit Lyonnais, which owns 53 per cent of Woodchester Investments, in central Paris yesterday.

Dense clouds of black smoke billowed over the Right Bank's financial district from the ornate mid 19th century building, a massive stone structure occupying an entire block between the Bourse and the Opera.

The fire is the latest blow to the troubled institution, which suffered record losses in 1994 and was bailed out by the government.

Flames and smoke poured out the back and two sides. The imposing Second Empire facade was untouched but a burned out interior could be seen through tall windows.

Some 250 firefighters with 36 fire engines fought the blaze, emergency workers said.

"It's superb, it's amazing," said a bystander watching the dramatic scene which attracted hundreds of bystanders and amateur photographers.

The Paris police chief Mr Philippe Massoni said the fire was probably caused by a short circuit in cabling in the first floor dealing room, which is filled with computer screens and electronics.

Twelve people, including nine firefighters, were treated for light injuries, mainly heat exhaustion, a spokesman for the fire service said. The three other injured were bank security staff members who had inhaled smoke.

Bank spokesman Mr Nicholas Chaine said: "There is no risk of a breakdown in service to our clients. All our trading rooms are connected around the world and all safeguards were taken."

Banks and brokerages normally make computer copies of all trading operations, which are stored in secure sites away from main offices as a precaution against disasters or attacks.

The fire was "unfortunate but something we plan for, although we hope it never happens", Mr Chaine said.

He said all trading operations were `backed up' and no data had been lost. The bank's London trading room could take over today, though London's financial markets are closed for a bank holiday.

The bank's customers would not see any effects from the fire, but most of the inconvenience would be felt by the 2,500 employees who work at head office, Mr Chaine said.

The bank was "well insured", he said, but gave no further details. He could not estimate the cost of the damage.

A fire services spokesman said four floors of the five story building, including the roof, had caught fire. About 6,000 square metres of the total 38,000 square metres of floor space was burned out.

The state controlled bank is pushing through a government backed rescue plan in which 135 billion francs (£16.7 billion) of assets, including the MGM Hollywood studio, have been put into a holding company to be sold off.

It made a slender 13 million franc profit for 1995 after stunning financial markets the previous year with a loss of 12.1 billion francs.