Societe Generale ceases its activities in Russia and signs an agreement to sell Rosbank and its Russian Insurance subsidiaries
11 April 2022 - 4:01PM
Societe Generale ceases its activities in Russia and signs an
agreement to sell Rosbank and its Russian Insurance subsidiaries
SOCIETE GENERALE
CEASES
ITS ACTIVITIES IN
RUSSIA AND
SIGNS
AN AGREEMENT TO SELL ROSBANK AND
ITS RUSSIAN
INSURANCE
SUBSIDIARIESPress release
Paris, 11 April 2022, 8 am
Societe
Generale ceases
its banking and insurance activities in Russia and
announces the signing of a sale and purchase agreement to
sell its entire stake in
Rosbank and the Group’s Russian
insurance subsidiaries
to Interros
Capital, the previous shareholder of Rosbank. With
this agreement, concluded after several weeks of intensive work,
the Group would exit(1) in an effective and orderly manner from
Russia, ensuring continuity for its employees and clients.
This contemplated transaction, which remains
subject to the approval of the relevant regulatory and anti-trust
authorities, will be conducted in compliance with the legal and
regulatory obligations in force. The closing of this operation
should occur in the coming weeks.
The impact of the disposal of Rosbank and the
Group’s Russian insurance activities on the
Group's CET1 ratio is expected to
be around 20
basis points based on the net value of the
disposed assets as of December 31, 2021(2). It would mainly result
from the impact of the write-off of the net book value of the
disposed assets, largely offset by, on the one hand, the
deconsolidation of the local exposure to Russia (~EUR 15.4 billion
of exposure at default as of December 31, 2021(3)) and on the
other, a payment in favor of Societe Generale including notably the
repayment by the purchaser of the subordinated debt granted by
Societe Generale to its subsidiary.
Pro-forma this transaction, the Group’s
CET 1 ratio would remain comfortably above the Group’s
guidance. As a reminder, the Group's CET1 ratio was 13.7%
as of December 31, 2021, i.e. 470 basis points above the minimum
regulatory requirement.
This contemplated disposal would lead to the
accounting in the Group’s income statement(4) of the following main
items:
- the write-off of
the net book value of the divested activities (~EUR 2
billion(5));
- an exceptional
non-cash item with no impact on the Group’s capital ratio
(~EUR 1.1 billion(5)), which corresponds to the normative
reversal of the conversion reserve in the Group’s income
statement.
The Group confirms its distribution policy for
the 2021 financial year i.e. the cash dividend of EUR 1.65 per
share, subject to the approval of the Combined General meeting of
shareholders on 17 May 2022, and the announced share buyback
program for an amount of approximately EUR 915 million(6).
(1) ALD Automotive OOO, which operates in
Russia and through its branches in Kazakhstan, and ALD Belarus LLC
no longer conclude any new commercial
transactions.(2) Value as of December 31, 2021
based on a EUR/RUB exchange rate of
85.(3) Equivalent to ~EUR 10.7 billion of Risk
Weighted Asset as of December 31,
2021.(4) Accounted in “net profit or loss on other
assets”.(5) Based on non-audited estimated data as
of February 28, 2022 and a EUR/RUB exchange rate of 92. The final
impact would be calculated based on the data and the foreign
exchange rate at the closing date. The accounting period would
depend on the closing date.(6) Subject to usual
approvals from ECB and Combined General meeting.
Press Contacts: Societe GeneraleJean-Baptiste Froville_+33 1 58
98 68 00_ jean-baptiste.froville@socgen.comFanny Rouby_+33 1 57 29
11 12_ fanny.rouby@socgen.com
Societe Generale
Societe Generale is one of the leading European financial
services groups. Based on a diversified and integrated banking
model, the Group combines financial strength and proven expertise
in innovation with a strategy of sustainable growth. Committed to
the positive transformations of the world’s societies and
economies, Societe Generale and its teams seek to build, day after
day, together with its clients, a better and sustainable future
through responsible and innovative financial solutions.Active in
the real economy for over 150 years, with a solid position in
Europe and connected to the rest of the world, Societe Generale has
over 131,000 members of staff in 66 countries and supports on a
daily basis 26 million individual clients, businesses and
institutional investors around the world by offering a wide range
of advisory services and tailored financial solutions. The Group is
built on three complementary core businesses:
- French Retail
Banking which encompasses the Societe Generale, Credit du
Nord and Boursorama brands. Each offers a full range of financial
services with omnichannel products at the cutting edge of digital
innovation;
-
International Retail Banking, Insurance and Financial
Services to Corporates, with networks in Africa, Russia,
Central and Eastern Europe and specialised businesses that are
leaders in their markets;
- Global Banking and Investor
Solutions, which offers recognised expertise, key
international locations and integrated solutions.
Societe Generale is included in the principal socially
responsible investment indices: DJSI (Europe), FTSE4Good (Global
and Europe), Bloomberg Gender-Equality Index, Refinitiv Diversity
and Inclusion Index, Euronext Vigeo (Europe and Eurozone), STOXX
Global ESG Leaders indexes, and the MSCI Low Carbon Leaders Index
(World and Europe). In case of doubt regarding the authenticity of
this press release, please go to the end of Societe Generale’s
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- Societe Generale ceases its banking and insurance activities in
Russia
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