Banks are facing a prolonged period of less freedom to expand internationally due to the social and economic effects of Covid-19, Societe Generale’s chief executive Frédéric Oudéa tells Euromoney.
He expects that heightened public pressure on the financial sector to act in society’s interest after the pandemic – coupled with the need to finance domestic economic reconstruction – will mean that there will be more limitations on where banks can deploy their capital.
And he believes that these limitations will last much longer than the current urgent need for loans to bolster business liquidity.
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Frédéric Oudéa, Societe Generale |
“The pressure we will have in the coming years to give a priority to financing of national and domestic economies where we operate will be very strong,” he says. "For us it means, certainly, more constraints in terms of capital allocation, because the need to support the economy will be on top of the agenda.
“In each country the attention of each government for the banking sector to play its role, not just to deal with the immediate urgency but beyond to potentially be able to finance the new investments, which might be desired to stimulate the economy, will be very strong.
