SocGen fires its Russian unit’s chief executive

FRENCH bank Societe Generale yesterday sacked the boss of its Russian subsidiary Rosbank after the unit continued to under-perform despite a major shake-up by the parent firm.

It comes less than a month after chief executive Vladimir Golubkov was arrested on bribery charges after investigators filmed him with large amounts of cash in his office.

He pleaded innocent to the charges, which could see him jailed for seven years if found guilty. He is currently under house arrest.

The French parent is now looking to reassure investors on the financial stability and growth potential of Rosbank. The Russian unit has performed poorly despite an acquisition and restructuring campaign costing SocGen an estimated €4bn (£3.4bn).

SocGen has received criticism for not exercising more control over Rosbank’s management. However, SocGen head country manager Didier Hauguel defended his role yesterday, saying that many executives have been replaced over the past year.

Ratings agency Moody’s reiterated Rosbank’s credit rating after the arrest, arguing Golubkov alone was not crucial to the bank’s stability.

“We do not currently envisage any material implications for Rosbank’s business or financial fundamentals following the investigation,” Moody’s said. “The bank’s business is not critically dependent on its CEO, and we believe that there is an efficient succession planning in place for top management personnel at Rosbank.”

SocGen said yesterday that the process was underway to begin a search for Golubkov’s replacement. His first deputy, Igor Antonov, is now acting as chief executive under supervision from Hauguel.

The new appointment will require the approval of Russia’s central bank.