By Pablo Mayo Cerqueiro, Mathieu Rosemain and Andres Gonzalez
LONDON/PARIS (Reuters) – Societe Generale is open to a sale of its Equipment Finance business as the French bank’s new CEO Slawomir Krupa embarks on a broad strategic revamp, people familiar with the company told Reuters.
The bank sees the business as non-core, having sold part of its operations in 2020, said the people, who spoke on condition of anonymity. But a transaction may not happen soon because difficult market conditions weigh on the unit’s valuation, they said.
Krupa, who will present SocGen’s new strategic plan on Monday, will try to convince investors he can boost returns while setting achievable goals in a challenging environment marked by slowing economic growth.
The bank’s shares trade at 34% of their book value, almost on par with Deutsche Bank but half of the multiple of its bigger French rival BNP Paribas and Italy’s UniCredit, amid concerns about the company’s exposure to more volatile income from investment banking.
A spokesperson for SocGen declined to comment.
Societe Generale is also said to be mulling options for its asset custody division, based on media reports.
Societe Generale Equipment Finance provides equipment leasing and financing solutions to manufacturers, dealers and vendors in sectors ranging from transport to industrials.
The business employed 1,400 people and had roughly 24 billion euros ($25.6 billion) of loans outstanding at the end of last year, including partnerships, based on SocGen’s latest annual figures.
SocGen is unlikely to commit to major sales of businesses at the upcoming investor day, and Krupa may indicate an intention to prune non-core units over time, the people also said.
Rather than naming non-core businesses, Krupa is more likely to outline the group’s growth areas, said one person familiar with the bank’s thinking.
($1 = 0.9392 euros)
(Reporting by Pablo Mayo Cerqueiro, Mathieu Rosemain and Andres Gonzalez; Additional reporting by Amy-Jo Crowley; Editing by Elisa Martinuzzi, Silvia Aloisi and Jane Merriman)
