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Bloomberg
Societe Generale SA said two deputies to Chief Executive Officer Frederic Oudea are stepping down in a shakeup of top management, as the bank vowed to accelerate the transformation of its business after posting the biggest loss since the onset of the financial crisis.
As part of the overhaul, Deputy CEO Severin Cabannes will leave his post at the end of this year, the lender said on Tuesday in a statement. The new team will have two deputy CEOs instead of four and newly created roles of deputy general manager for a new generation of “high-potential leaders,†SocGen said.
The move comes after the bank suffered its worst quarter since rogue trader Jerome Kerviel’s record loss more than 12 years ago. SocGen was forced to write down the value of its trading business following heavy losses on the complex structured products it and its French peers are known for.
Natixis SA, which suffered similar losses in its trading business, on Monday replace CEO Francois Riahi after just two years, citing differences over strategy. Both lender indicated they would adjust the business with structured products as a result of the losses this year.
At SocGen, Oudea had come under pressure before, after being in charge for more than a decade. The lender late last year initiated a formal search for a successor, Bloomberg has reported. The plan then was to have a candidate ready when the CEO’s term ends in 2023, though the replacement could happen before that, people familiar with the matter said at the time. The management reshuffle may buy him time to turn around the lender.
The losses at SocGen and Natixis were more stark after their biggest rival, BNP Paribas SA, rebounded from a trading hit with a standout performance in fixed-income. Revenue from trading fixed-income securities, currencies and commodities jumped 154% in the second quarter from a year earlier, offsetting a more than 53% decline in equities trading. It said there was only a “residual impact†from the dividend cancellations.
As part of SocGen’s shakeup, Deputy CEO Philippe Aymerich will see his mandate extended to all international retail banking and consumer credit activities. He replaces Philippe Heim who is leaving his deputy CEO position as of Tuesday, the bank said.