SocGen may close trading unit due to low profits
Societe Generale is considering closing its proprietary-trading unit, following the same move by its French rival BNP Paribas.
Closures incoming?
According to Bloomberg, SocGen is reviewing the future of the Descartes Trading division, which is struggling to make profits, and has been accused of making risky bets with its shareholders’ funds.
SocGen’s proprietary-trading unit in Hong Kong is no more, which closed at the end of 2018, which is believed to have kickstarted a trend of the close of its trading activities.
According to the group, its trading revenues slumped around 20% in the fourth quarter, alongside a spike in market volatility.
Looking at the year overall, the bank says it has seen a decline of about 10% in revenue from its markets units, with a 5.4% slump in its shares. However, this seems to be a trend affecting all French banks.
BNP Paribas closed its trading unit, Opera Trading Capital, as was also reported by Bloomberg, as it struggled to make profits too.
