Socgen targets dealmaking to boost corporate banking

PARIS: Societe Generale said on Monday it plans to revamp its corporate and investment banking businesses by shiting resources into dealmaking and reducing its trading arm’s exposure to market swings.

France’s third-largest listed bank said it is looking to boost profitability in the investment banking division and stabilise revenue ater its flagship equity derivatives business, long a strength, was hit hard during the COVID-19 pandemic last year.

“Global Markets will deliver... a more predictable performance,” Socgen’s head of Global Markets Jean-francois Gregoire told analysts.

The bank seeks to grow its advisory business where it is currently a second tier player when it comes to advising on mergers and acquisitions and capital raising globally, trailing behind most major US and European investment banks.

Last year it ranked 21st globally for advising on debt raising according to Refinitiv data, though it has a stronger presence in areas like green equity deals and asset finance.

Shares in Socgen were up 2.71 per cent at 1018 GMT. The bank said it targeted a return on normative equity of more than 10 per cent in its global banking and investor solutions businesses from 2023, up from 7 per cent now.

The lender also said it targeted a cost base of between 5.5 billion euros to 5.7 billion euros ($6.69 billion-$6.93 billion) in 2023 in its global banking and investor solutions businesses, from around 5.8 billion euros in 2020, as it presses on with previously announced savings.