Seeing Opportunity In Obstacles

Inside Sibos | Day 3

“Global Transaction Banking is the fastest growing unit in Société Générale,” says Christian Behaghel, head of GTB at the bank. “It is a very stable business, and while we generate something like 6% of the total revenue of the bank, we are experiencing growth of our revenue of 10-15% a year.” This compares, he says, to some areas of retail banking that have 0-2% growth a year. Behaghel joined the division just a year ago, coming from investment banking, and recognizes the clear differences between the two areas of business for the French bank.

GTB coordinates the activities of SocGen in correspondent banking, factoring, trade finance, cash management and FX, which lately means not only other financial institutions and exotic currencies but also corporates—a trend we explored in the Sibos Preview newsletter last week. “Other banks have the securities business linked with GTB,” explains the French banker “but for us it is linked with the investment banking.” That link is another big trend in transaction banking.

The two functions of GTB are very clear: “to serve local clients, and to serve large corporations and financial institutions, some 800 in the world, in supranational services,” says Behaghel. The bank, besides its European presence, focuses on its areas of strength in West and North Africa, in Eastern Europe and in Russia. To cover other markets, the bank often partners with “strong regional players like ANZ for Southeast Asia and Barclays for parts of Africa where we do not have a direct presence—like we do in the north of the continent and in the francophone countries,” he notes. “We are also looking for a possible partner in Latin America.”

The priorities of Behaghel? “Manage better working capital for clients and understand better the needs of corporates.” So much so that in order “to offer more intelligent services in areas like treasury, we are recruiting people from corporates,” he says. While many have bemoaned the negative impact of Russian sanctions on trade flows, Behaghel has the opposite view. With its strong presence in Russia where it controls over 99% of Rosbank, he sees the sanctions as “an opportunity in trade finance. Our bank does all the funding there and is not supported by the holding [company], and while other banks are retreating.. our business is growing.”