Financial services companies Societe Generale and Absa Group have signed a memorandum of understanding (MOU) to roll out a pan-African wholesale banking offering.
Absa has also agreed to buy Societe Generale’s custody, trustee and clearing services operated in South Africa to advance its growth strategy.
Societe Generale has its presence in 19 African countries, mainly in Western and Northern Africa. The bank offers its clients with the expertise of an international combined with the proximity of local banking networks.
Absa has a presence in 12 countries across Southern and Eastern African region. The bank has better knowledge of local markets, allowing to meet the needs of its clients in full range of local banking solutions.
Through the partnership, Societe Generale and Absa plan to leverage the geographical complementarity and combined strengths to reinforce their expertise and offer a range of banking products and services to international and domestic corporate clients and financial institutions operating in the continent.
Even though the deal is a non-exclusive agreement, the pan-African offering could be enriched over time with new products and services.
Societe Generale stated that this agreement is in line with its growth strategy in the continent.
Societe Generale CEO Frédéric Oudéa said: “Large African companies and multinational groups present in Africa have increasingly sophisticated banking needs and require expertise that was mostly delivered in more mature economies. On the other hand, there are more and more regional champions on the continent for whom national markets have become too narrow.
“Joining our forces through this agreement makes perfect sense to accompany the economic development of the continent.”
In a separate deal, Absa will acquire the related activities conducted by Societe Generale in South Africa, notably its client portfolio, IT systems and all the employees dedicated to these activities.
This acquisition is subject to approval from relevant authorities which is expected to be obtained by the end of this year.