UniCredit, Italy’s second-largest bank, is bringing its domestic securities services business back in-house, ending a two-decade outsourcing arrangement with France’s Société Générale as it seeks to standardize operations across Italy and Germany and strengthen control over key back-office functions.
The Italian lender confirmed the move on Tuesday, following a Reuters report late on Monday that cited a union document. The transfer will involve 54 employees currently working for Société Générale Securities Services, who will move to UniCredit as the bank restructures its securities services operations.
“The transfer supports the … bank’s previously announced plan to internalize key back-office activities for securities services, establishing harmonized suppliers and processes across Italy and Germany and creating a more streamlined, resilient and scalable operating model,” UniCredit said in a statement.
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The decision reverses an arrangement established in 2006, when Société Générale acquired the business from UniCredit. At the time, the unit employed 435 people, making the transaction an important step in the French bank’s entry into Italy’s securities services market.
The latest transfer involves a much smaller workforce, with only 54 employees moving back to UniCredit. The difference in staffing levels highlights how significantly the business has changed since the original transaction, although the figures alone do not establish the extent to which the reduction resulted from automation, restructuring or other operational changes.
The move forms part of UniCredit’s broader effort to reorganize securities services and bring selected activities under direct control. For Société Générale, it means relinquishing a business it acquired as part of its expansion into Italy, even as the French lender continues to regard the country as an important market.
Securities services cover the administrative and operational functions that support the ownership and trading of financial assets. These activities include maintaining securities records, processing transactions, and handling other services required by investors and financial institutions.
Although less visible than lending, investment banking, or retail banking, these operations are essential to the functioning of financial markets. Their reliability affects how efficiently institutions manage assets, process transactions and meet their obligations to clients.
By bringing the Italian unit back in-house, UniCredit intends to align its securities services operations more closely with those in Germany. The bank said the move would establish more consistent suppliers and processes across the two markets, supporting a more integrated operating model.
Standardization can help large financial institutions reduce operational complexity, improve coordination and establish more consistent controls across business units. It can also make it easier to manage technology systems, service delivery and compliance requirements across different jurisdictions.
However, internalization does not automatically guarantee lower costs or better performance. Bringing an outsourced activity back into a bank requires the transfer of responsibilities, systems and operational knowledge, while the institution must ensure that service quality remains consistent throughout the transition.
The move also underpins a broader question facing banks that have outsourced non-core activities over previous decades: whether external providers continue to offer the most effective operating model as institutions seek greater integration across markets and business lines.
Outsourcing can provide access to specialized expertise and allow banks to avoid maintaining certain capabilities internally. Internalization, by contrast, can give management more direct oversight of critical processes and make it easier to coordinate operations with the institution’s wider technology and organizational structure.
UniCredit’s decision suggests that the bank sees greater value in managing these functions within its own operating framework, particularly as it seeks consistency between its Italian and German businesses.
Société Générale’s Two-Decade Presence in Italy
The original 2006 transaction marked Société Générale’s entry into the Italian securities services market. The French bank subsequently developed its presence in the sector, building relationships with clients and expanding its broader securities services business.
Earlier this month, Société Générale said it had established solid client relationships in Italy over the past two decades and considered the country a strategic market for the group.
The transfer of UniCredit’s domestic unit therefore represents a change in the scope of the French bank’s activities rather than evidence, on its own, of a broader withdrawal from Italy.
Société Générale remains one of Europe’s leading securities services providers, with nearly €6 trillion in assets under custody. It ranks among the top three providers in Europe and within the global top 10.
Assets under custody refer to financial assets that an institution safeguards and administers on behalf of clients. The measure indicates the scale of a securities services business, although it is distinct from assets owned by the provider itself or assets managed directly under an investment mandate.
The scale of Société Générale’s custody operations underscores the importance of securities services within the financial industry. Banks and other financial institutions rely on these providers to support the administration of investments across markets, making operational reliability and client relationships important sources of competitiveness.
The loss of UniCredit’s Italian unit will need to be viewed in that wider context. The available information does not specify the financial value of the transferred business or the effect on Société Générale’s revenue, so the transaction’s financial significance for the French bank cannot be quantified from the disclosed figures.
UniCredit said the internalization would support the creation of more than 200 roles as part of its securities services transformation programme. Some of those positions will be filled through the retraining of existing employees.
The planned roles are separate from the 54 employees transferring from Société Générale, and the bank’s statement does not provide a full breakdown of their locations, functions or timing.
The employment plans suggest that the transfer is part of a wider reorganization rather than simply a change in the employer of a small group of workers. UniCredit appears to be using the transformation programme to develop additional internal capabilities while aligning processes across its operations.
Retraining existing staff could help the bank adapt its workforce to the revised operating model, particularly where changes in technology, systems and internal responsibilities require different skills. However, the company has not disclosed the specific roles or the expected cost of the programme.
The transition will also require careful coordination between the outgoing service provider and UniCredit to ensure that client services continue without disruption. Securities administration involves time-sensitive processes, and failures in transaction processing or recordkeeping can create operational and reputational risks.
The intended benefits for UniCredit will need to be measured against the costs of absorbing the unit, developing internal capabilities, and maintaining service standards.