SocGen to take $4.5 billion hit from sale of Russia business

PARIS (BLOOMBERG) – Societe Generale (SocGen) will take a hit of about €3 billion (S$4.5 billion) after agreeing to promote its Rosbank unit to the funding agency of Russia’s richest man.

The Paris-based financial institution signed an accord to promote its whole stake in Rosbank and its Russian insurance coverage subsidiaries to Mr Vladimir Potanin’s Interros Capital, in accordance to an announcement on Monday (April 11).

SocGen stated it can proceed its plans for a inventory buyback of €915 million and a 2021 dividend of €1.65 a share.

SocGen’s choice to exit Russia is essentially the most decisive but among the many largest European banks with operations within the nation. Both Raiffeisen Bank International and UniCredit are additionally contemplating their future within the nation. The three banks are the most important on the continent with Russian companies.

SocGen stated it can have a €2 billion write-off of the web e-book worth of the divested actions and an distinctive non-cash merchandise of €1.1 billion associated to the reversal of the conversion reserve within the group’s earnings assertion.

SocGen chief government officer Frederic Oudea final month signalled that the financial institution deliberate to keep versatile in Russia, stopping quick of becoming a member of European rivals pledging to evaluation or exit their business within the nation after Russia’s invasion of Ukraine.

SocGen’s Russian business generated 2.7 per cent of final yr’s revenue and accounts for 1.7 per cent of the financial institution’s complete publicity. Local actions are primarily uncovered to retail and enormous company shoppers.

Interros was the earlier shareholder of Rosbank.

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