SocGen to withdraw from retail banking in Poland: report

Société Générale, which owns Eurobank, is set to sell its assets and withdraw from the Polish retail banking market. Photo: Wikimedia Commons/MB71EB

Reuters has reported that French banking giant Société Générale is selling its assets in Eurobank in a bid to withdraw from the Polish retail banking market entirely.

Despite last year’s PLN 103 mln (EUR 24 mln) profit, Eurobank currently has assets amounting to PLN 14 bln (EUR 3.27 bln), putting it in 17th place in the list of the largest banks in Poland. According to two sources Reuters describes as “bankers”, Société Générale, which owns Eurobank, is set to sell its assets and withdraw, following increased pressure from their competition.

“Eurobank is in the process of being sold, and Société Générale wants to entirely withdraw from the Polish retail banking market,” one of Reuters’ anonymous sources said.

While Société Générale has not yet commented, the Financial Times reported that the French company is looking to join forces with UniCredit. Jean-Pierre Mustier, the chairman of UniCredit, is also the former chairman of Société Générale and has been developing the merger for several months according to the FT.

The news that Société Générale is looking to withdraw from the Polish market is the next in a list of western financial companies withdrawing their retail banking services from Poland. UniCredit itself, prior to considering the merger with Société Générale, sold its stake in Poland’s Bank Pekao S.A. last year to the Polish insurance group PZU.

In May 2017 Reuters reported that Deutsche Bank was putting its Polish assets up for sale for PLN 2 bln (EUR 467 mln), citing the bank’s strategy, which included withdrawing from “all markets which were not key to its development.”

In 2015 the Austrian Raiffeisen Bank International announced that it would be selling its local Raiffeisen Bank Polska assets. The Polish subsidiary was bought by the French BNP Paribas for PLN 3.25 bln (EUR 760 mln), which owns a controlling stake in BGŻ.

Earlier, in 2013, the Nordic giant Nordea Bank sold its Poland-based assets to PKO BP and withdraw from the market, and in 2011 the British HSBC also disappeared.

The Polish market, according to a report by and boasts of a total of 43 million retail clients and 32 million personal accounts. The clients at the end of 2017 held as many as 25 million debit cards and a total of 9 million of them use mobile banking.

The current rash of bank sales has created the opportunity for Polish-owned groups to redress what had seemed like over-domination of foreign players in the banking sector. After the reshuffle in the sector, the top two players PKO BP and Pekao SA, in which the Treasury have a stake, account for nearly 10 million of the total of 43 million personal accounts.

The likelihood is that there will be further concentration on the market. Banks are closing branches and more and more transactions are carried out online, which is a global trend.