SocGen Is Looking to Save $660 Million at Paris Headquarters

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SocGen Is Looking to Save $660 Million at Paris Headquarters(Bloomberg) -- Societe Generale SA is studying ways to save 600 million euros ($662 million) in annual costs tied to its operations in Paris, part of an effort to win back investor confidence and improve returns.The review, known internally as “Ithaque,” started in June, according to a person familiar with the matter. No decision has been made and the savings target may still change, said the person, asking not to be identified because the matter is confidential.The bank declined to comment.Chief Executive Officer Frederic Oudea is under pressure to go beyond existing cost cuts amid an economic slowdown and the prospect of even lower interest rates. The new reductions would focus on Paris support functions and add to an ongoing restructuring that aims to save 500 million euros and eliminate 1,600 jobs, mainly in the investment banking unit.Despite a rebound this month, SocGen is still down about 8% in 2019, faring worse than a 1.3% decline in Europe’s Stoxx 600 banking index.Strengthening CapitalOudea, more than 10 years in the job, is slashing costs and selling assets after a surprise profit warning in January. He wants to preserve the bank’s leadership in businesses such as equity derivatives while strengthening capital.SocGen has hired Bain & Co. to help identify ways to slash expenses by about a fifth on services such as information technology, human resources and the finance department, Bloomberg reported last month. The review might lead to hundreds of additional job cuts in Paris, one person familiar with the matter has said.The firm’s also working with McKinsey & Co. to find ways to bolster its key capital level and keep up with regulatory demands in a review known internally as “Optica,” Bloomberg reported in June.Oudea has also been exploring sales of assets. SocGen is considering options for its Lyxor asset-management business,which oversees about 151 billion euros, people familiar with the matter said last month. The company is also weighing exits from its U.K. private banking business and Nordic equipment-leasing operations, people familiar with the matter have said. Last year, it agreed to sell its Belgian private banking unit to ABN Amro Group NV.To contact the reporter on this story: Fabio Benedetti-Valentini in Paris at fabiobv@bloomberg.netTo contact the editors responsible for this story: Dale Crofts at, Marion Dakers, Sree Vidya BhaktavatsalamFor more articles like this, please visit us at©2019 Bloomberg L.P.

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