Krupa’s grand plan for SocGen launches with a whimper
Despite tweaks to improve efficiency, Societe Generale’s new strategy has received a lukewarm reception. New CEO Slawomir Krupa has lifted the capital target, but revenues will remain flat, and there is a lack of news on asset sales.
Societe Generale’s capital markets day on Monday – the first under new chief executive Slawomir Krupa – was a highly anticipated event for the bank.
Investors were hoping for higher returns targets and some concrete news such as a big asset sale that would unequivocally demonstrate a change of direction and jolt the share price out of its torpor.
Although no such sales were announced, there were signs of a shift away from the growth culture that prevailed at the French bank for most of the last decade under former chief executive Frédéric Oudéa.
After outperforming European bank shares ahead of the investor day, SocGen was still trading at a 60% discount to book value in mid September. As Krupa himself acknowledged on the day, this compares with a discount of only 20% among its peers.
Among the top five eurozone lenders by assets, only Deutsche Bank is lower-valued, while UniCredit (often seen as one of SocGen’s closest peers) has recently traded slightly higher than BNP Paribas at 0.7x