One month after the start of the war in Ukraine, Societe Generale has so far decided not to leave Russia while its competitors withdraw one by one from the country. The French bank controls the Russian heavyweight Rosbank.
At the beginning of March, Societe General had indicated that it was exposed to Russia worth 18.6 billion euros (approximately 19 billion francs), including 15.4 billion only for Rosbank.
Other French banks have already decided: At the beginning of the week, Crédit Agricole and BNP Paribas, certainly much less exposed and therefore have less to lose, announced that they were ceasing their activities in the country.
Above all, other large international banks with a larger presence in Russia are also pulling out.
The US Citigroup announced in mid-March that it had stopped operating in Russia and was evaluating the scope of its activities in the country, although it “takes time to implement”, she said.
At the same time, the Italian bank UniCredit, which has been present in Russia for 30 years, indicated that it was “considering leaving” the country. At worst, it could cost up to 7.5 billion euros.
Above all, the bank must “take into account the interests of [ses] employed in Russia, [ses] customers operating in Russia, many of whom are European, and general health “in the group, detailed its general manager Andrea Orcel.
UniCredit had already given up at the end of January to apply for the takeover of its Russian competitor Otkrytié due to the tensions associated with the crisis between Russia and Ukraine.
The Austrian Raiffeisen, which has been in operation in Russia for 25 years and has about 4.5 million customers there, declared for its part on March 17 “to assess all the strategic options” for the future of its subsidiary in Russia, ” including a withdrawal “from the country.
Societe Generale thus seems quite isolated. And “it is very possible that it will end up giving in,” Eric Dor, director of economic studies at the IESEG School of Management in Paris and Lille, told AFP.
In the political discourse, the situation of the Societe Generale does not seem to be the core of the concerns at the moment. In France, the pressure is more focused on companies like TotalEnergies, especially the attack by presidential candidates Yannick Jadot and Anne Hidalgo.
Before French parliamentarians on Wednesday, Ukrainian President Volodymyr Zelensky also asked French companies to leave Russia, citing Auchan, Renault and Leroy Merlin, but not the French bank.
Societe Generale was one of the first to be penalized by the markets for its involvement in Russia. Following the announcement of the invasion of Ukraine on February 24, the title lost 12.15% on the Paris Stock Exchange. It then toppled until early March, before rising again, without regaining its pre-war level.
So far, the French bank wants to be reassuring. She said in early March that she was “fully capable” of resisting a possible loss of control of Rosbank, with an exposure to Russia of 18.6 billion euros, of which 15.4 billion only for Rosbank.
Its CEO Frédéric Oudéa last week insisted on the independent management of the subsidiary. “Rosbank was organized and governed independently after the events in Crimea” in 2014, he explained during a conference hosted by US bank Morgan Stanley.
It would be difficult for Societe Generale to leave Russia: losing Rosbank would cost it around 1.8 billion euros, she estimated, and it would have to find a solution for its 12,000 employees.
It would be “getting them to pay for Putin’s policies when they are not necessarily in favor of war,” Eric Dor explains.
The best thing for the bank would be “to find a buyer or otherwise to be expropriated. It would be technically easier” for its employees, believes a financial analyst who wishes to remain anonymous.
Without a buyer, a withdrawal can have significant consequences: Rosbank is considered a systemic institution by the Russian central bank, and a bankruptcy will therefore have an impact on the entire Russian economy.
This article has been published automatically. Sources: ats / awp / afp