Societe Generale to divest UK and Swiss private banking arms for £770m

Societe Generale has sold its UK and Swiss private banking divisions for £770 million as directors continue to slim down the business.

France’s third-largest listed lender has sold SG Kleinwort Hambros and Societe Generale Private Banking Suisse to Union Bancaire Privee (UBP).

The divisions together manage approximately £21 billion of assets.

This comes after CEO Slawomir Krupa promised to increase the group’s profits by cutting costs and divesting parts of the organization.

Krupa, a veteran of Societe Generale, took over from former CEO Frederic Oudea last year.

In an effort to turn the company’s fortunes around, he recently sold its equipment financing division, Moroccan bank and other assets in Africa.

The focus is on private banking in France, Luxembourg and Monaco.

For UBP, the deal will take its assets under management to more than £161 billion and expand its presence in the UK, the Swiss bank said in a separate statement.

But SocGen shares fell 1.7 percent in Paris. Along with its European peers, it has struggled to restore profitability since the 2008 financial crisis.

The bank also suffered from a costly exit from Russia after its invasion of Ukraine in 2022.

Investors were shocked last week when the company announced that net interest income from its French retail arm (the difference between what banks earn on loans and what they pay out on deposits) was likely to reach £3.3bn in 2024.

That was £258 million less than previously expected.

The company lost more than a fifth of its value over the past year.