November 27, 2017 / 9:37 PM / a year ago

SocGen to cut costs, protect dividend in 2017-2020

FILE PHOTO - A view shows the logo on the headquarters of French bank Societe Generale at the financial and business district of La Defense near Paris, France, September 6, 2017. REUTERS/Gonzalo Fuentes

PARIS (Reuters) - Societe Generale (SOGN.PA) said on Monday it plans to close more branches and cut staff in its French retail banking network while selling assets, as part of a three-year plan to boost returns.

Chief Executive Frederic Oudea, who took the top job following a rogue trader scandal in 2008, is under pressure to boost profitability in the face of tougher regulation and client demand for increasing investment in new technologies.

France’s third-largest listed bank unveiled a 1.1 billion euros (982.8 million pounds) savings plan that will cut 900 jobs in its French retail bank, close 300 branches and reduce the number of back office centres.

It is also seeking to increase revenue by more than 3 percent annually - with the slowest growth seen coming from French retail and the strongest from international retail banking and financial services.

The bank’s shares have underperformed peers so far this year amid fears that pending legal disputes could hurt dividends.

But SocGen said it was targeting progressive dividend growth, with a 50 percent payout ratio and 2.20 euro floor - matching what it paid on 2016 results - to apply from 2017.

It also said it could sell or close sub-scale businesses accounting for around 5 percent of the group’s risk-weighted assets, which stood at 353 billion euros as of Sept 30.

Reporting by Maya Nikolaeva; Editing by Laurence Frost and Alison Williams

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