SocGen picks investment bank head Krupa as next chief executive

Societe Generale will appoint Slawomir Krupa as chief executive officer, favoring the investment bank chief over retail head Sebastien Proto after a close contest to replace outgoing boss Frederic Oudea. 

The French bank's board made the selection for the top job in Paris Friday, according to a statement confirming earlier reports. Finding a successor to Oudea, the longest-serving CEO of any major European bank, entailed a monthslong search which courted external candidates but ultimately came down to two serving lieutenants. 

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Krupa will now be tasked with winning over investors after a lengthy stock slide under Oudea, who steered the bank through the financial crisis, Europe's debt turmoil, and multiple restructurings. This year has brought new challenges as the war in Ukraine forced the firm into a rushed sale of its Russia unit. Oudea is set to leave the lender next year and join the French drugmaker Sanofi as its next chairman. 

Krupa, 48, takes the role after less than two years heading the investment bank from New York, at a time when the lender's overall fortunes have shown some improvement after the turbulence of the pandemic. 

Read More: SocGen's Survivor CEO Oudea to Step Down After 15-Year Reign 

A 26-year veteran of the bank, Krupa joined SocGen's internal auditing body after graduating from Institut d'Etudes Politiques de Paris, also known as Sciences Po. He climbed the echelons of the lender's investment banking operations until becoming deputy head of global finance in 2012.

In 2016, Krupa was appointed CEO of Societe Generale Americas, a post he held during the lender's remediation talks with the U.S. Department of Justice over Libor manipulation and the bribing of Libyan officials. He worked with the U.S. Federal Reserve to improve SocGen's compliance functions.

The nod to Krupa, despite his reputation for a management style that some have found combative, may be recognition of his knowledge of the inner workings of the bank. Under his leadership the investment bank has outperformed expectations, though he's benefited from predecessors' changes. The appointment will mean Krupa, who holds French and Polish citizenships, would return from New York to Paris. 

French establishment

Unlike most of his recent predecessors, Krupa did not attend the elite Ecole Nationale d'Administration and did not start his career in the French government's auditing body, Inspection Generale des Finances. This departure from tradition signals the board based its decision on the candidates' banking skills, rather than their respective profiles within the French establishment.

While the executive search had raised the possibility of an external candidate taking over the bank, no outsiders eventually convinced the board.

Proto, who joined SocGen in 2018 as head of strategy, was in charge of merging the two French retail lenders, Societe Generale and Credit du Nord, an arduous task at the heart of Oudea's strategic rejig. Still, his lack of experience at the investment bank meant he spent less time than Krupa dealing with regulators, an essential part of any global bank CEO's toolkit.

Oudea's reign has been marred by successive crises such as Libor rigging, and regular restructuring plans. Since he became CEO in 2008 the share price has fallen almost 70%. French rival BNP's stock has dropped about 34%.

In August, SocGen outlined new revenue targets and pledged higher profitability as rising interest rates and a global trading rally brightened the outlook. Yet growing recession fears and rampant inflation have since clouded that picture, putting hopes for 2023 in doubt.

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