Societe Generale to expand prime brokerage to grow client balances
CEO Slawomir Krupa plans to scale up prime brokerage to raise client balances from about $210 billion and target roughly 3% annual revenue growth while cutting costs.
On Monday Societe Generale’s CEO Slawomir Krupa set out a plan to expand the bank’s prime brokerage operations with the aim of growing client balances from the roughly $210 billion reported at the end of August. The strategy pairs cost reductions with a target of about 3% annual revenue growth.
The bank has started adding services such as cash prime brokerage for equities as it seeks deeper relationships with hedge funds and asset managers. The expansion will cover financing, trading and custody services that institutional clients typically use.
Societe Generale plans to broaden offerings across its fixed-income and credit businesses, including derivatives and financing products, to widen sources of revenue from institutional counterparties. Krupa described the course as an effort to “scale up” prime brokerage and deepen ties with institutional clients.
In the United States the firm has been hiring staff to strengthen advisory capabilities for equity and debt issuance. Bank executives are also assessing opportunities to provide financing for data-center projects.
Prime brokerage is a competitive market where banks supply leverage, securities financing and clearing services to hedge funds and alternative managers. The bank expects a larger client footprint to increase its role as a provider of leverage and financing to managers that are seeking to diversify their banking relationships.
Societe Generale’s fixed-income operation has lagged some peers in recent quarters, and several senior trading executives left during the year. The expansion of prime brokerage and investment in credit and derivatives is designed to reinforce parts of the markets business where the bank has faced pressure.
The plan sets a clear financial objective: roughly 3% annual revenue growth over the coming years, achieved through a mix of lower costs and higher-margin business development. Building scale in prime brokerage is a central revenue initiative within that broader strategy.
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