IMF chief Christine Lagarde has been named as an "assisted witness" by French prosecutors investigating a state payout to a disgraced tycoon when she was finance minister.

Lagarde was questioned for a total of 24 hours in realtion to ministerial misconduct over her 2007 handling of a row that resulted in 400 million euros being paid to controversial business figure Bernard Tapie.

The head of the IMF has escaped charges in relation to the investigations.

While Lagarde wasn't placed under formal investigation, her "assisted witness" status means she could face further questions and possibly charges at a later stage.

The board of the International Monetary Fund have expressed their confidence in its first woman leader after learning of the court's decision.