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According to the announcement, the sale is due to be completed in the following weeks.
Paris-based bank Societe Generale SA (SocGen), has announced its decision to sell its stake in Rosbank. The decision followed mounting pressures to cut down ties with Russia which invaded Ukraine in what was called ‘a special military operation’. The bank would be sold to Interros Capital alongside its other Russian insurance subsidiaries.
SocGen acquired its initial stake in Rosbank in 2006 with an option to become the majority holder in 2008. By 2010, the Russian bank was fully merged with SocGen’s other Russia operations. While its contemporaries were pulling out of Russia earlier, SocGen remained resolute about staying in Russia. Last month, SocGen Chief Executive Officer Frederic Oudea reiterated the bank’s plan to stay flexible in Russia.
However, SocGen has now bowed to the pressure. SocGen joins the list of brands that have pulled out of the country amid growing sanctions from Western countries. Companies like Goldman Sachs, Commerzbank AG, JPMorgan Chase & Co, and Deutsche Bank AG have all exited the country.
SocGen Promises a Smooth Transition for Staff and Clients in Russia
According to the announcement, the sale is due to be completed in the following weeks. The sale will go on provided necessary approval is obtained from the relevant regulatory and anti-trust bodies. The Group is expected to phase out its operations in a way that will ensure continuity for its staff and clients.
Following the sale, the Group’s CETI ratio is expected to drop by about 20 basis points. According to the company’s Q4 2021 earnings, the Group had 470 basis points more than the minimum requirement. Thus, the drop is not expected to weigh too much on the company’s overhead.
Consequently, Rosbank will join the empire of Vladimir Potanin. According to Bloomberg’s Billionaires Index, Potanin is the 43rd richest person globally with a net worth of $29.6 billion. Potanin owns Norilsk Nickel (GMKN.MM) which supplies 40% of the world’s palladium and a 10% supply of refined nickel globally.
Up until recently, Potanin has avoided any sanctions. He was however sanctioned recently by the Canadian government as well as European sanctions against Russian individuals and entities continue. Recall that Chelsea and its owner, Roman Abramovich were also sanctioned in a bid to curtail Russia’s excesses as the war continues.