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SocGen's researchers could sup at the lucrative severance pot

If you're going to lose your job anywhere, you probably want to lose your job at Société Générale. While other banks piffle around with a couple of weeks' payouts for every year served, SocGen is known for its lavish treatment of everyone it's had enough of. Past payments have been to known to reach €340k.

Following today's announcement of its joint venture with Bernstein Research, there are suspicions that SocGen will soon be bathing its unwanted people in money once again. This time, it's equity researchers at the French bank who could be on the receiving end of the generosity.

There's no mention of job cuts in SocGen's announcement. It says the joint venture will combine, "Bernstein Research Services’ premier global equity research and execution platform with Societe Generale’s equity research and execution capabilities to form a leading global cash equities and equity research business." Slawomir Krupa, the head of SocGen’s investment bank, told the Financial Times that the geographic diversity of the two businesses means that jobs cuts should be minimal: Bernstein is strong in North America and Asia; SocGen is bigger in Europe. 

However, the strong suspicion is that the JV won't need all its combined staff. 

If this is the case, SocGen's equity researchers are likely to come out worse off. As Bernstein itself points out, it's ranked top for European companies and industries for the past 10 years. SocGen's best sector teams, by comparison, ranked 6th, 7th, 9th and 10th this year. Many of those teams are based in Paris, where severance is at its most generous.

"Bernstein has some of the best deep dive research in the market," says one headhunter. "A lot of their people come from the corporates they cover and have excellent insights and a good network. SocGen's research isn't nearly as good."

SocGen didn't respond to a request to comment on the likely implications for its equity researchers. Some may be spared, however: Bernstein doesn't cover some sectors, like real estate. 

SocGen's researchers could also benefit if Bernstein's researchers decide they don't like the JV and look for new jobs elsewhere. However, it's not really clear where they would go now that Exane and Redburn have also been subsumed by larger outfits.

If SocGen's researchers are let go, they could find themselves adrift in an unfriendly market: nearly 20 researchers have been ejected from Credit Suisse in London in recent weeks. However, French banks are notoriously slow to make cuts, so things could have picked up by the time they find themselves sending out CVs. And with payouts that big, they may feel inclined to spend some years on the beach anyway.

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AUTHORSarah Butcher Global Editor

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