Societe Generale SA plans to cut 640 jobs in France, especially in its investment banking operations, as CEO Frederic O’Dea moves to move away from risky products that backfired in the first half
The bank said in a statement on Monday that part of the cut related to Societe Generale’s decision to halt trading in complex structured stock products. Stock business as well as compliance and risk operations will be affected
Oudea reshaped senior management in August after the bank’s worst quarter since rogue trader Jerome Kerviel caused a record loss in 2008 The CEO is now working to reduce risk and accelerate the move toward simpler products at the investment bank, while trying to defend SocGen’s standing. Pioneering equity structured products
The bank said the job reduction plan does not include any forced cuts and will instead focus on voluntary departure and redeployment of employees to new positions The initiative is subject to discussions with employee representatives.
The bank said cuts and reorganization of some of its business would contribute to its plan, announced in August, to cut costs by 450 million euros ($ 534 million) within the capital markets division by 2023
Societe Generale’s stock rose by 42% in Paris trading and has risen 33% as of 10:59 AM and the stock has fallen 56% this year, the fourth worst performance on the Stoxx Europe Banking Index
The bank rebounded in the third quarter with better-than-expected earnings. Equity trading and fixed income both performed better than expected, although the increase did not bring gains in some competitors during the period of big gains for Wall Street banks
Job cuts in European banks continue, even after many reported lower-than-expected loan losses and boosted capital ratios in the third quarter. Bloomberg reported last week that cuts announced by Banco Santander SA and ING Groep NV raised the overall job losses announced. Globally this year, to 75,368 jobs That’s on his way to over 80000 cuts last year
Société Générale, Investment Banking, Les Echos, France
World News – US – Société Generale cuts 640 jobs, most of them in investment bank
