SocGen sees bigger returns from car leasing than banking

To find Societe Generale’s most profitable business, don’t look to its trading floors or executive suites in Paris or London, but to gritty parking lots in Lyon, Helsinki and Sao Paulo.

Bloomberg News reports that the bank, whose mathematical prowess made it a world leader in equity derivatives, generates its best returns from a more prosaic business: leasing fleets of automobiles.

The development of the car-leasing operation and its growing importance to Societe Generale show how some European lenders are looking outside traditional banking as tougher capital requirements and record-low interest rates sap returns. BNP Paribas and Banco Santander have also increased their leasing businesses -- from cars to farm equipment to computer systems -- to generate profits without tying up capital.

“This is currently a plus for banking profits,” said Karim Bertoni, who helps manage $7bn at Bellevue Asset Management in Switzerland.

To access the complete Bloomberg News article hit the link below:

At Societe Generale, Returns From Car Leasing Dwarf Banking

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