Societe Generale, France’s third-largest listed bank, is set to further streamline its operations in Africa with the recent announcement of the sale of two of its subsidiaries – Societe Generale Burkina Faso and Banco Societe Generale Mocambique.
The buyer is the Pan-African banking group Vista Group, marking another strategic move in Societe Generale’s ongoing efforts to optimize its capital utilization. The deal was revealed in a joint statement by the companies on Thursday, December 7, 2023.
Vista Group is poised to acquire a 52.6% stake in Societe Generale Burkina Faso and a 65% stake in Banco Societe Generale Mocambique. The transaction is part of Vista Bank’s ambitious expansion strategy to establish itself as a Pan-African financial institution with a presence in 25 countries.
Simon Tiemtore, President of Vista, emphasized the significance of the agreement, stating that it aligns with their broader vision for growth. While the deal has been struck, its finalization is contingent on regulatory approvals, as indicated by Vista.
Such regulatory clearance is a routine prerequisite in the banking sector, ensuring compliance with local laws and regulations. Once completed, this transaction will mark Societe Generale’s exit from Burkina Faso and Mozambique, following the previously announced sales of subsidiaries in Congo Brazzaville, Equatorial Guinea, Mauritania, and Chad.
The decision to divest from Burkina Faso and Mozambique aligns with Societe Generale’s broader strategy under CEO Slawomir Krupa to optimize the bank’s capital usage. This move is consistent with a trend observed in the banking industry, with other financial institutions, including larger rival BNP Paribas, also undertaking similar measures to enhance operational efficiency.
Remaining Presence in Africa
Despite the ongoing divestitures, Societe Generale remains committed to its presence in Africa. After the completion of these sales, the bank will continue its operations in 10 African countries. This underscores Societe Generale’s intention to maintain a strategic footprint in the African market, focusing on regions where it can achieve sustainable growth and better capitalize on its resources.
The announcement also mentioned that Societe Generale is currently undergoing a strategic review of its 52.34% stake in Tunisia’s Union Internationale de Banques (UIB). The outcome of this assessment will likely shape the bank’s future decisions regarding its involvement in Tunisia and further contribute to its overall strategic realignment.
Societe Generale’s strategic reshaping signals a dynamic response to the evolving global financial landscape. By divesting from certain African subsidiaries and concentrating on key markets, the bank positions itself to navigate challenges effectively while capitalizing on emerging opportunities. The ongoing strategic review of its stake in Tunisia’s Union Internationale de Banques reflects a commitment to carefully evaluating each aspect of its portfolio.
As the financial industry undergoes transformations, Societe Generale’s proactive approach underscores its commitment to resilience and long-term success, ensuring it remains a strategic player in the African and global banking arena.
Societe Generale’s agreement to sell subsidiaries in Burkina Faso and Mozambique to Vista Group represents another milestone in the bank’s efforts to optimize its operations and focus on core markets. As the financial landscape continues to evolve, these strategic moves underscore the importance of adaptability and efficient capital deployment in ensuring sustained growth and profitability for banking institutions.
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