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CORRECTED-SocGen shuts bank branches through French summer lull
August 12, 2014 / 11:26 AM / 3 years ago

CORRECTED-SocGen shuts bank branches through French summer lull

(Corrects name of bank to Hello bank! in 13th paragraph)

By Maya Nikolaeva

PARIS, Aug 12 (Reuters) - French bank Societe Generale has closed some of its branches for the summer lull this year as part of an experiment with reduced opening hours as Internet banking takes off.

Banks across Europe are reducing branch networks to improve profitability in a weak economic environment and as the online banking boom accelerates the shift away from a traditional banking model.

Societe Generale, France’s second-biggest listed bank, started a 6-to-8-months long experiment with opening hours in the first half of this year. The summer closures are a part of that, a spokeswoman at SocGen said.

The spokeswoman declined to give the number of branches involved or further details of the summer closures, but added that as part of the experiment, some may be closed for half days or closed completely through the summer in order to regroup forces at bigger sites.

Societe Generale’s 3,161 branch network as of 2013 was already 2 percent smaller than in 2010. The number of online connections to its services has more than tripled over the last four years.

The number of clients who visited a French bank branch several times per month plummeted to 17 percent in 2013 from 52 percent in 2010, a survey by the country’s banking association showed in May.

The French travel most in the last month of summer, according to studies by the Economy Ministry, and in Ile de France, the area around and including Paris which accounts for a third of the bank’s retail revenue, drops sharply during August as city dwellers leave for the coast and the countryside.

Grocery stores, bakeries and real estate agencies all close for several weeks one after another as clients disappear.

The results of SocGen’s experiments will be discussed with the unions, the spokeswoman said.

“Societe Generale’s management is doing some experiments to see how the network may evolve in the future, rather than waiting for the consequences of the changing customer behavior,” said Philippe Fournil, CGT union representative.

Officials of other major French banks were unable to say whether they had plans to copy SocGen’s move.

BNP Paribas, which has a smaller retail network in France, targets 210 million euros in investments over the next three years to adapt its 2,139 branches in France to the changing climate. BNP has cut the number of branches by 5 percent since 2010.

European lenders, like SocGen and BNP are boosting their own online business to counter low-cost Internet-competitors. BNP launched a Europe-wide online bank called Hello bank! last year and SocGen bought out minority holders of its online bank brand Boursorama.

BPCE, the second-biggest retail bank, has launched two online banking brands since 2010. Credit Agricole, the largest retail lender in France, was not available for a comment.

Reporting Maya Nikolaeva; Editing by Erica Billingham

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