SocGen Edges Closer to Settling U.S. Sanctions Investigation

(Bloomberg) -- Societe Generale SA said that it expects to settle U.S. investigations into alleged sanctions violations “within the coming weeks,” and that the final penalty will probably be broadly in line with its estimates.

“Societe Generale has entered into a phase of more active discussions” with the authorities investigating past dollar transactions involving countries under U.S. sanctions, the French lender said in a statement on Monday. “At this stage, Societe Generale expects that the amount of the penalties in the U.S. sanctions matter will be almost entirely covered by the provision for disputes.”

SocGen had already set aside around 1.2 billion euros ($1.4 billion) to settle an investigation that has involved the U.S. Treasury, federal and New York state attorneys’ offices, the Federal Reserve and the New York Department of Financial Services.

Ending the probe is a key step for Chief Executive Officer Frederic Oudea. It will enable him to concentrate on his goals of improving profitability, selling non-core assets and sustaining growth in the group’s dividend.

With the announcement, SocGen appears likely to pay much less than the $9 billion that larger rival BNP Paribas SA paid four years ago, after pleading guilty to charges about forbidden transactions involving Iran, Cuba and Sudan. Credit Agricole SA, France’s second-largest bank, paid $787 million to U.S. regulators in 2015 as part of a deferred prosecution agreement to solve a similar sanctions case.

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