Bloomberg News

Societe Generale Says Australia Operations Are Under Review

February 15, 2012

(Updates with global job cut plans in fourth paragraph.)

Feb. 15 (Bloomberg) -- Societe Generale SA, France’s second-largest lender, is reviewing its operations in Australia as Europe’s debt crisis spurs banks to scale back lending in the nation.

“A number of options regarding our set up in Australia are currently under review,” said Hong Kong-based spokeswoman Kate Henley in a phone interview today, declining to comment further. The Paris-based lender has an equipment finance unit and a corporate and investment banking unit in Sydney, according to its website.

European banks are cutting costs as they prepare for regulations on minimum capital levels and the sovereign-debt crisis persists, threatening revenue from trading and investment banking. Financial firms globally announced more than 200,000 job losses in 2011, up from about 58,000 in 2010, according to data compiled by Bloomberg.

Societe Generale plans to cut about 1,580 jobs at its corporate and investment bank, including 700 staff in countries other than France, a spokeswoman said last month.

BNP Paribas SA said Nov. 16 it plans to cut about 1,400 jobs at its corporate and investment banking division, or 6.5 percent of the unit’s staff worldwide.

European banks provided about 10 percent of syndicated lending in Australia in 2011, down from an average 20 percent in the two years prior, the Reserve Bank of Australia wrote in its quarterly monetary policy statement released Feb. 10.

Societe Generale helped provide loans in Australia in 2011 for Paladin Energy Ltd., Origin Energy Ltd. and a project finance facility to fund the construction of a hospital in the state of South Australia, according to data compiled by Bloomberg. It had a 0.4 percent share of the Australia and New Zealand syndicated loan market, down from 1.1 percent in 2010, the data show.

--Editors: Shelley Smith, Katrina Nicholas

To contact the reporter on this story: Sarah McDonald in Sydney at smcdonald23@bloomberg.net.

To contact the editor responsible for this story: Shelley Smith at ssmith118@bloomberg.net.


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