IMF head Christine Lagarde faces investigation decision

French judges will decide whether Ms Lagarde was wrong to intervene in a legal battle between a formerly state-owned bank and a French tycoon.

Lagarde denies misconduct. There is no suggestion she profited personally.

Correspondents say if the inquiry is approved it will cast a shadow over Lagarde's month-long IMF stewardship.

Lagarde took over as managing director from Dominique Strauss-Kahn in July, following his arrest in May on charges of the attempted rape of a New York hotel maid.

Prosecutors say Lagarde abused her authority by approving a 285m-euro ($406m) payment to businessman Bernard Tapie, a former left-wing minister who switched sides to support Nicolas Sarkozy in the 2007 presidential election.

At the time Tapie was in the midst of a court battle with the former state-owned bank Credit Lyonnais.

He alleged the bank had defrauded him in the 1990s, when he sold a stake in the sports clothing business Adidas.

The businessman had lost the case in the country's highest court but was appealing against the decision.

Some months later, new Finance Minister Lagarde overruled objections from her officials and intervened in the judicial case, pushing the bank and Tapie into binding arbitration.