Societe Generale sees huge potential in Chinese market
CGTN Global Business

Societe Generale is very keen to enter the China market following an announcement by the Chinese government that it will further open up the financial sector to foreign ownership amid ongoing China-U.S. trade tensions, a senior executive has said.

Pierre-Yves Bonnet, group country head and chairman of Societe Generale China, told CGTN that the financial services multinational has long-lasting experience in the capital markets, especially derivatives.

"The opportunity created by the announcement of the government to [allow foreign firms to] fully own a securities company by the end of 2020 is an opportunity we are going to look at very intently," Pierre-Yves Bonnet told CGTN in an interview. "We are very keen to enter the Chinese market where see a huge potential."  

In October, the China Securities Regulatory Commission announced that limits to foreign stakes in futures, mutual fund and securities companies will be removed by 2020. This was part of the government's ongoing reforms of the financial market.

Pierre-Yves Bonnet, group country head and chairman of Societe Generale China. /CGTN Photo

Pierre-Yves Bonnet, group country head and chairman of Societe Generale China. /CGTN Photo

SocGen to focus on equities business

Bonnet said that the French lender is looking at focusing on the equities business in the Chinese market.

"What we see in the Chinese market... especially in thinking what we know best, it's equities. Obviously, we know fixed income and derivatives and fixed income as well, but what we know best is equities," he said.

Bonnet said that the Chinese market is still in its infancy, with a small market and 85 percent of investors being retail investors.

"So for a modern financial market to grow, you need institutional investors, and institutional investors need to manage their risks.. .and how do they manage their risks...they use derivatives and that's where we come in," he explained.

Societe Generale, said Bonnet, has observed huge digital innovation in the financial space that was brought about by the Chinese companies in the past eight to ten years, but those were mostly focused on payments and retail banking.

"What we see in the next step, the focus will be on corporate banking," he said, adding that the company has founded a new outfit and is developing solutions based on blockchain technology.

Earlier this month, Bloomberg reported that Societe Generale was seeking greater foreign growth as Europe stagnates and is considering a fully-owned brokerage in China, joining a rush by the world's biggest banks as the country speeds up the liberalization of ownership restrictions in the financial sector.

(CGTN's Michael Wang contributed to this report)