The sale, which will result in a net loss of around 3.2 billion euros in the French bank’s income statement, also covers the group’s insurance subsidiaries.
The French bank Societe Generale announced on Wednesday that it had finalized the sale of Rosbank, a Russian banking heavyweight in which it was the majority shareholder, which was bought by the Russian investment fund Interros founded by the oligarch Vladimir Potanin, close to Vladimir Putin.
The sale, the amount of which is not disclosed, also concerns the group’s insurance subsidiaries.
It will result in a net loss of around 3.2 billion euros in Societe Generale’s income statement in the second quarter, said the French group, slightly more than the 3.1 billion communicated last month, when announcing a transfer agreement.
“This operation (…) will have a high cost (…) but a limited capital impact”, said Tuesday the general manager Frédéric Oudéa, whose mandate ends in 2023, during the general meeting of the bank.
The impact on capital was described as “residual” by the group in its press release, and the core capital ratio, a key indicator that measures the ability to overcome a possible crisis, will remain well above the regulatory requirement.
“The challenge was obviously to find a recovery solution allowing us to withdraw in an effective and orderly manner, ensuring continuity for Rosbank’s customers and employees”, Mr. Oudéa also underlined.
Interros, which is also the previous shareholder of Rosbank, is one of Russia’s largest funds. It holds assets in heavy industry and metallurgy, notably in the Nornickel company and in the pharmaceutical sector (Petrovax).
It was founded by 61-year-old Vladimir Potanin, one of Russia’s most powerful and well-known oligarchs. Close to Vladimir Putin, he was in 2021 the second richest personality in Russia with a fortune estimated at 27 billion dollars, according to Forbes magazine.
Rosbank brought in 115 million euros in 2021 to Société Générale for 643 million euros in turnover, or 2% and 2.5% respectively of the whole group.
For retail banking, Russia was the group’s third largest country, following France and the Czech Republic. And the second in terms of workforce, with more than 12,000 employees, or a tenth of the total.
