Read news from:
Austria
SHARE
COPY LINK

SOCIÉTÉ GÉNÉRALE

French banking giant SocGen to cut 1,000 jobs

French banking giant Société Générale revealed on Tuesday it would cut at least 1,000 jobs worldwide, in an effort to find almost €1 billion in savings by 2015. The announcement comes as the bank's first-quarter profit fell by half.

Published: 7 May 2013 11:09 CEST
French banking giant SocGen to cut 1,000 jobs
French banking giant Societé General to cut 1,000 jobs worldwide. Photo: Loic Venance/AFP

French bank Société Générale reported on Tuesday that first-quarter net profit fell by half to €364 million and said it would save €900 million by 2015 with the loss of more than 1,000 jobs worldwide.

The cost cuts are in addition to cuts of €550 million effected last year.

General manager Jean-Francois Sammarcelli, when asked on French BFM Business radio if the bank expected to shed more than 1,000 jobs, replied that the figure would be substantially higher.

He said that the cuts would include the loss of about 550 jobs at the bank's headquarters in Paris.

The bank employed about 154,000 people throughout the world of whom 60,000 were employed in France, he said.

The price of shares in the banking group rose by 4.0 percent in initial trading, with analysts welcoming the cost-cutting strategy.

In the first three months of the year, net profit fell by half from the equivalent figure last year, owing to exceptional cost factors totalling €488 million.

And the outcome fell short of the net result broadly expected by analysts polled by Dow Jones Newswires who had foreseen about €370 million.

However, net banking income, a key measure of performance by a bank regarding the margin between the cost of taking in deposits and the price of lending them out, fell by 19.4 percent to 5.1 billion euros.

This exceeded the expectations of analysts who had forecast 4.94 billion euros.

The bank said in a statement that it had decided to apply a programme to improve efficiency with three objectives: "Reduce costs and strengthen competitiveness, simplify the way the group functions and to strengthen synergy between the resources used by the different activities of the bank."

The full effect of the programme would be achieved at the end of 2015 when total savings of €1.45 billion would have been made compared with figures at the beginning of 2012, the statement said.

This programme would involve restructuring and investment costs of €600 million.

This would enable the bank to achieve a return on capital employed of 10.0 percent, chief executive Frederic Oudea said.

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.

BANKING

Card over cash? Why Germany is seeing a new payment preference

Cash has long been king in Germany, with many smaller retailers refusing to join the rest of the world in adopting contactless payment systems. But card-based payments are on the rise, as recent stats about Girocard use reveal.

Published: 13 February 2024 12:31 CET
Card over cash? Why Germany is seeing a new payment preference

Germany has long been a very cash-based country, occasionally to the dismay of frustrated tourists at the Döner shop.

A few German phrases express the people’s love of physical money. There’s ‘only cash is true’ – Nur Bares ist Wahres. Or Bargeld lacht, literally meaning cash laughs, but used to imply that cash is what’s wanted, similar to ‘cash is king’ in English.

But the classic German preference for cash appears to be evolving, as the use of girocards is growing, even for small transactions.

How are girocards being used?

Girocard, an ATM and debit card service offered by German Banks, was designed to allow customers to use virtually all German ATMs and, increasingly, to make purchases at businesses.

READ ALSO: Ask an expert – Why is cash still so popular in Germany, and is it changing?

Last year, consumers in Germany used their Girocard more often than ever before for cashless payments. A total of €7.48 billion payment transactions with the plastic card were counted – 11.5 percent more than in the previous record year 2022, according to figures published by the Frankfurt-based institution Euro Card Systems.

Whether at the bakery, petrol station or supermarket, customers are increasingly pulling out their cards at the checkout, even for smaller amounts. As a result, the average amount paid with the Girocard fell from €42.34 to €40.69 within a year. 

The rise of card payments in Germany

Contactless payment, which is possible with girocards and credit cards that have an NFC chip, got a boost during the Covid pandemic, as retailers promoted it for hygiene reasons. 

But the use of card payments has continued to grow in Germany since then, boosted partly by the increasing use of girocards.

Promoting the use of girocards, some German banks have expanded their cards’ functions: Sparkassen, Volksbanken, or Raiffeisenbanken offer girocards for the digital wallet, for example.

Banks want to continue upgrading the payment card with further applications. For example, a project is being tested which would add an age verification function to girocards that would be useful when a customer is buying cigarettes.

On the retail side, it’s clear why the Girocard is preferred to other debit options.

“We see that debit cards from international providers cost up to four times more,” Ulrich Binnebößel, Head of the Payment Systems & Logistics Department at the German Retail Association (HDE) told DPA.

What’s the difference between the Girocard and other debit?

The Girocard is a strictly German phenomenon. It can be seen as the latest iteration of the EC card, which was created to consolidate payment systems following the unification of former East and West Germany.

In 1991 different debit card systems, including Eurocheque guarantee cards from former West Germany and Geldkarte ATMs from former East Germany, were unified into Eurocheque cards.

Then in 2001, the Eurocheque system was disbanded, but German banks continued to use the EC logo for “electronic cash’” cards, or EC cards. In 2007, the German Banking Industry Committee introduced Girocard as a common name for electronic cash and the German ATM network.

Girocards are only issued and accepted in Germany, so if you want to get one of your own, you’ll have to join a German bank, and shell out those notorious German banking fees.

READ ALSO: Why it’s almost impossible to find a free bank account in Germany

Alternatively, you can get by with internationally accepted debit cards provided by a bank in your home country, or otherwise by joining an app-based European banking service like N26. 

But be warned, without the Girocard in hand, at some smaller retailers you may be told, “Leider nur Bargeld oder EC-Karte.”

With reporting by DPA

SHOW COMMENTS