QNB buys Egypt arm of Societe Generale for $2bn

Societe Generale will sell its majority stake in Egypt’s National Societe Generale Bank to Qatar National Bank for $2 billion, as part of the French bank’s bid to meet new capital requirements.

The sale, which is expected to be completed in the first half of 2013, promises a net gain of around 350 million euros ($456 million) and will lift SocGen’s core Tier 1 capital ratio by close to 0.3 percentage points by the end of next year under Basel III banking rules, the bank said.

“This means there will be no more questions over SocGen’s capital base for 2013,” said Natixis analyst Alex Koagne.

He forecast that France’s second-biggest bank would have a Tier 1 ratio of 9.6 per cent of risk-weighted assets under Basel III at the end of 2013. The bank’s own target is for nine to 9.5 per cent at the end of 2013.

“This could lead instead to questions over whether SocGen could pay a cash dividend next year,” he said.

SocGen, like domestic rivals BNP Paribas and Credit Agricole, has spent the past year selling assets and cutting jobs to beef up its capital reserves and lift its stock-market valuation in the face of the global economic slowdown and euro zone debt crisis.