(Bloomberg) -- Societe Generale SA’s capital will be hit more than previously estimated after a regulatory probe of its structured products business, even as the lender seeks to boost its financial strength.

The probe by the European Central Bank will lower SocGen’s common equity Tier 1 ratio by about 20 basis points, Chief Financial Officer Claire Dumas said during an investor day event in London Monday. That will likely take the CET1 reduction from regulatory issues this year to about 50 basis points, compared with previous guidance of 30 basis points.

A plan to increase SocGen’s capital strength is a key element in a new strategy unveiled by Chief Executive Officer Slawomir Krupa at the same event. Krupa also lowered the range of the lender’s targeted payout ratio as part of the effort and said the bank may not grow revenue in the coming years. 

“The capital base is the backbone of banking,” said Krupa. “We want to have a rock solid balance sheet.” 

Investors were disappointed by the strategy update, and the stock was down as much as 11.8% on Monday.

Dumas also said that a planned update to global rules dubbed “Basel IV” will weigh less on SocGen’s capital ratio than previously expected. 

SocGen’s CET1 ratio stood at 13.1% at the end of June, well above its minimum requirement. A basis point is equal to 0.01 percentage point. 

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