Rogue trader, euro zone crisis and war, Socgen‘s CEO ends ’bumpy ride at top

div classBodysc17zpet90 cdBBJodivpBy John ODonnell and Julien Ponthusp

pFRANKFURTLONDON Reuters – Societe Generale CEO Frederic Oudea, who navigated the French bank through a rogue trading scandal and the euro zone crisis, will leave next year, ending a tumultuous 15 years at the top.pdivdivdiv classBodysc17zpet90 cdBBJodiv

pThe longestserving chief executive of a major European bank, Oudea took charge at the height of the 2008 financial crisis as the bank grappled with the multibillioneuro fallout of a rogue trading scandal.p

pA student of France‘s elite Polytechnique engineering school and of the National Administration School, whose graduates include French presidents Jacques Chirac and Emmanuel Macron, Oudea started his career in the civil service before becoming one of the country’s bestknown bankers.p

pHe prepares to leave as the bank struggles with the aftermath of a pandemic and the economic uncertainty created by war in Ukraine.p

p“It‘s been a very bumpy ride,” said Jerome Legras of Axiom Alternative Investments, who said some investors were frustrated by what they deem the bank’s modest progress. p

pIn common with many European peers, the share price of Societe Generale never recovered from the 2008 debt crisis and at about 24 euros 25.24, is less than half of its level when Oudea became CEO. p

p2008 ROGUE TRADER SCANDALp

pOudea became Societe Generale‘s finance chief in 2003 but long played a secondary role to JeanPierre Mustier, then head of Socgen’s investment bank and considered the likely future CEO. p

pThe scandal in 2008 over a 4.9 billion euro loss triggered by trader Jerome Kerviel turned the tables in favour of Oudea, who became chief executive at the age of 44.p

p20092012 EUROZONE CRISISp

pThe euro zone debt crisis hit French banks in particular because they were heavily exposed to debt in Greece and other countries at the periphery of the euro zone. This triggered speculation, including that the French government could be forced to nationalise lenders.p

pIn 2011, as Greece struggled to cope with debt repayments, jitters swept through Europe over the future of its banks.p

pFrance and its lenders were considered vulnerable. A flurry of media reports and speculation, including that Societe Generale even faced collapse, rocked its shares, putting Oudea to his toughest test.p

pPressure abated on the industry when Mario Draghi, who was European Central Bank president at the time, pledged to do “whatever it takes” to back the euro.p

p2015 SALESp

pOudea is credited with shoring up the banks capital base, its weakness after the 2008 crisis, selling some businesses and paring back its Eastern Europe arm.p

pThe sale of the banks stake in Amundi in a 2015 multibillioneuro stockmarket listing granted Oudea a windfall. He later sold the exchangetraded funds specialist Lyxor to Amundi.p

pHe made Boursorama the top French online bank while cutting branches through a merger with the Credit du Nord network.p

pOudea‘s arguably boldest move was at the start of this year when Societe Generale’s car leasing division ALD, which he floated in 2017, signed a 4.9 billion euros deal to buy Dutch rival LeasePlan. p

pNonetheless, some remained underwhelmed by Oudea. “Investors felt there was a lack of a clear strategic goal,” said Legras. p

pThe risks from trading continued to overshadow the bank. In early 2020, it posted a surprise firstquarter loss after a revenue wipeout at its equity trading division after market volatility caused by the pandemic.p

pThe bank has since overhauled that division.p

p2018 LIBYA BRIBERY p

pThe bank paid 1.3 billion in penalties for wrongdoing, including bribing Libyan officials, an episode for which Oudea apologised.p

pBetween 2004 and 2009, Socgen paid more than 90 million in bribes through a Libyan broker to secure 14 investments by Libyan stateowned financial institutions, the U.S. Justice Department had said.p

p2022 RUSSIA DEPARTUREp

pLast month, Socgen became the first major Western bank to announce its departure from Russia, navigating a highly charged standoff between Russia and the European Union, which has been ratcheting up sanctions in response to Moscows invasion of Ukraine on Feb. 24.p

pSocgen announced it would sell its Rosbank business to Interros Capital, a company linked to Russian oligarch Vladimir Potanin, writing off roughly 3.1 billion euros. p

pSocgen was one of a handful of European banks with a significant presence in Russia and the sale was seen as a coup by investors despite the heavy cost because it drew a line under its involvement with Russia.p

p1 0.9508 eurosp

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pp Editing by Barbara Lewisp

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