by Mathieu Rosemain
PARIS (Reuters) – Slawomir Krupa, who takes the reins of Societe Generale on Tuesday, has a clear mission: to put the red and black bank back among the leading global establishments with its own identity.
It will have to find a delicate balance for this, by improving the return for shareholders without taking excessive risks, in a difficult context for the banking sector on the stock market.
“It is very important to clarify (things) where it is necessary and to say it very clearly to all of our stakeholders: ‘Société Générale, that’s it’”, he explains in an interview with Reuters.
Slawomir Krupa, who has spent most of his career at the bank, will unveil his strategy by the fall.
After leading the investment bank of Societe Generale, he will officially become Tuesday at the general meeting of shareholders the new CEO of the group after the tumultuous and long term of 15 years of his predecessor, Frédéric Oudéa.
Under the latter, Societe Generale merged businesses, sold assets – including a costly exit from the Russian market – and reduced risk exposure.
Despite this, Societe Generale’s share price in relation to the value of the group’s tangible assets is 0.30, a ratio which places the French bank at the same level as its colleague Deutsche Bank but far behind its great rival BNP Paribas and in the bottom of the ranking of European banks.
Societe Generale’s vulnerability was made even more visible during the recent crisis that rocked the sector in March and during which the bank was among the hardest hit on the stock market.
Slawomir Krupa will have the task of getting Societe Generale out of this danger zone.
His top priority will be to improve the bank’s profitability under its current structure, as he has done for the investment banking division, a person familiar with the board said.
This could lead the bank to further exploit other sectors of activity in order to reduce an exposure deemed to be still too high in risky investment banking activities.
When he arrived at the head of the investment bank at the start of 2021, Slawomir Krupa reduced costs and tackled trading risks, observes this source close to the reflections of the board of directors.
Two years later, Societe Generale’s investment bank posted the strongest annual growth in pre-tax profit among listed rivals BNP Paribas and Credit Agricole SA, and strengthened its role as a driver of corporate profits. ‘establishment.
BREAK WITH TRADITION
The success of Slawomir Krupa, 48, as head of the investment bank worked in his favor when he ran for the post of chief executive last September, people familiar with the process said.
The Franco-Polish banker was born in Bulgaria, then under communist rule, in 1974. He emigrated with his family from Krakow, Poland, to France at the age of six.
Despite his 26 years at Societe Generale, his career constitutes a break in the line of his predecessors, all from the ranks of the senior civil service.
His character is also very different from that of Frédéric Oudéa.
“Each person has their own personality. Slawomir has an enthusiasm, a way of moving forward, of taking people with him. Frédéric (Oudéa) is more collegial,” said Jean-Pierre Mustier, former manager of UniCredit and the Société Générale’s investment bank.
Acknowledging his outspokenness himself, Slawomir Krupa can be impatient and demanding, says a senior Societe Generale executive.
The new Director General will have a lot to do from the start of his mandate. In business circles, it is not excluded that the bank should eventually merge with a European competitor.
An investment banker, who wishes to remain anonymous, believes that such a merger would be beneficial for Societe Generale, the bank being a “medium-sized player” eclipsed by its American rivals and its competitor BNP Paribas.
“How to improve the profitability (of banks) without mergers taking place? I don’t see how it’s possible at all”, underlines Jean Dermine, professor at INSEAD.
For the time being, Slawomir Krupa is monopolized by operational questions, such as the finalization of the joint venture formed with AllianceBernstein to combine their activities of cash shares and equity research.
The new leader assures him: a large-scale merger is not on the agenda in the short term.
“Strategically, does Europe need stronger banks? The answer is yes, but I don’t think that’s something that’s really on the agenda at this stage,” he said. at Reuters.
(Report Mathieu Rosemain, Blandine Hénault for the )
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