The French bank gives it to interros Capital, the preceding shareholder of the establishment. This withdrawal will weigh up to 3.1 billion euros in the accounts of Société Générale.
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Societe Generale had taken the party to leave Russia shortly after the beginning of the war in Ukraine. His boss, Frédéric Oudéa, however, indicated internally that “for a bank that finances the economy, which is under the guitelle of the central bank, we can not say overnight: I stop.”
So it’s “at the end of several weeks of intensive work” that the French banking group announced, on Monday, April 11, the signing of an agreement allowing it to assign all its subsidiary Rosbank and its insurance subsidiaries in Russia at Interrog Capital. This is the holding of the Oligarch Vladimir Potanine, one of the richest men in Russia and close to Vladimir Putin, who controls the Nornickel mining giant. Interros Capital is familiar with the bank since it was the previous owner of Rosbank, which he sold by blocks to Société Générale from 2006.
This operation, which should be finalized “in the coming weeks”, will allow the French bank to withdraw “effectively and ordered from Russia, by ensuring a continuity” to its 12,000 employees and its customers, specifies the group. In a separate statement, Interros stated on Monday that “the conditions of the Agreement [had] been approved by the Government Commission for Foreign Investment Control in the Russian Federation”.
“Significant financial consequences”
This departure is done at a strong price. Société Générale leaves little or prou leaving the keys. Rosbank, one of the main private Russian banks, was dearly acquired (4 billion euros in total) and the value of the ceded activities must be depreciated in the accounts of the French institution. On the other hand, it will receive “a payment” of the buyer, interrog capital, which will include the repayment of a debt granted by Société Générale to its Russian subsidiary of € 500 million.
Societe Generale has quantified the cost of this withdrawal to 3.1 billion euros. The tricolor bank, which generated 5.6 billion euros in profits in 2021, should absorb the shock. In a message sent Monday morning to the employees of the group, Frédéric Oudéa pointed out that “this assignment would have significant financial consequences in 2022, but that we will manage”. The Bank has also confirmed the payment of a dividend of 1.65 euro by action (subject to the vote of the general meeting of shareholders, May 17) and its share repurchase program announced for an amount about 915 million euros. “It’s not lethal for the group, but this episode accredits the opinion that it always happens something to society, since Kerviel, in 2008,” notes a former leader of the bank.
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