Societe Generale signs Memorandum of Understanding

 Société Générale’s Board of Directors, which met on 10 April under the chairmanship of Lorenzo Bini Smaghi, has approved the signing of a Memorandum of Understanding with Groupe BPCE for the divestment of the professional equipment financing businesses operated by Société Générale Equipment Finance (“SGEF”).

Groupe BPCE would take over most of Société Générale Equipment Finance’s activities, which offer tailor-made financing and leasing solutions for distributors, traders, manufacturers and companies. SGEF deploys its expertise internationally in the transport, industrial equipment, technology, medical and renewable energy sectors. The outstanding loans of the businesses covered by the Memorandum of Understanding amount to almost €15 billion at the end of December 2023, i.e. around €8 billion in risk-weighted assets (“RWA”).

This divestment project would mark an important step in the execution of Société Générale's strategic roadmap presented in September 2023, targeting a streamlined, more synergetic and efficient business model, while strengthening the Group’s capital base. This transaction would be done at a price of €1.1 billion and would have an estimated positive impact of approximately 25 basis points on the Group’s CET1 ratio at the completion date which should occur in the first quarter of 2025.

Chief Executive Officer of Société Générale Group Slawomir Krupa said, “During the presentation of the Group's strategy in September 2023, we affirmed Société Générale's ambition to be a rock-solid and sustainable top tier European bank. We announced that the Group would take strategic decisions to simplify its business portfolio and shape a more integrated, competitive and synergetic business model.

“The signing of the Memorandum of Understanding with Groupe BPCE for the sale of SGEF's activities illustrates the strategic roadmap’s execution that creates value for all our stakeholders.”

This project will be subject to the applicable social/labour procedures, the usual conditions precedent, and the approval of the relevant financial and regulatory authorities. Société Générale says it remains fully committed to its employees, clients and partners during this transition period.

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