SocGen Cuts Bonus Pool at Securities Unit, CEO Oudea Says
Feb. 16 (Bloomberg) -- Frederic Oudea, chief executive officer of Societe Generale SA, discusses the company's fourth-quarter profit reported today, the European Central Bank's three-year funding program and business outlook. France's second-largest bank said net income declined 89 percent to 100 million euros ($130 million) from 874 million euros a year earlier. He spoke yesterday in Paris with Bloomberg Television's Caroline Connan. (Source: Bloomberg)
Societe Generale SA (GLE), France’s second-largest bank, is cutting bonuses at its corporate and investment bank after the unit posted its first quarterly loss in two years.
“We cut the bonus pool of the SGCIB staff overall by something like 44 percent, in line of course with the results,” Societe Generale Chief Executive Officer Frederic Oudea said in an interview on Bloomberg Television today.
Societe Generale, which is cutting about 1,580 corporate- and investment-banking jobs worldwide, is following competitors including Deutsche Bank AG (DBK) of Germany and UBS AG (UBSN) of Switzerland in reporting a loss at the division in the fourth quarter. BNP Paribas (BNP) SA, France’s largest bank, yesterday reported that fourth-quarter pretax profit at its corporate- and investment- banking unit dropped 99 percent.
The world’s largest banks, including Frankfurt-based Deutsche Bank and JPMorgan Chase & Co., are curbing pay amid shrinking revenue and tighter capital requirements. Credit Suisse Group AG (CSGN), based in Zurich, said Feb. 9 it cut the 2011 bonus pool by 41 percent after the securities unit posted a second consecutive quarterly loss. UBS, Switzerland’s largest bank, said last week it reduced its 2011 bonuses by 40 percent to 2.57 billion francs ($2.8 billion).
The 2011 average bonus decline for market-related professionals at Societe Generale is “comparable” to BNP Paribas’s, Oudea told journalists at a press conference.
BNP Paribas CEO Jean-Laurent Bonnafe said yesterday that the bank reduced by half the 2011 bonus pool for capital-market professionals. Bonnafe didn’t elaborate.
To contact the reporter on this story: Fabio Benedetti-Valentini in Paris at fabiobv@bloomberg.net
To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net
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