With low interest rates continuing to crimp lending income and retail banking margins, France's third-biggest listed lender said the merging of the two networks would save more than 350 million euros ($424 million) in costs in 2024 and nearly 450 million euros in 2025.

SocGen said the plan will cost between 700 million euros and 800 million euros.

"The amount of synergies forecast by management are in line with our expectations and consensus expectations but restructuring costs are larger than we anticipated," UBS analysts said in a note.

SocGen shares were down 1.2% at 0959 GMT.

"There will be no forced redundancies or layoffs", SocGen's head of retail banking networks Sebastien Proto told reporters.

European lenders have been cutting branch numbers for years, but opposition from unions and politicians over banking access meant many were unable to cut as many as they wanted.

The number of bank branches in the European Union fell from about 238,000 in 2008 to 174,000 at the end of 2018, European Banking Federation figures show.

In Germany, Deutsche Bank and Commerzbank have both announced significant cuts to their branch networks this year, with Deutsche Bank set to close about a fifth of its outposts.

With the COVID-19 pandemic having accelerated the shift to online banking across Europe, SocGen also aims to strengthen its Boursorama online operation.

The bank said Boursorama is targeting 4.5 million clients in 2025, up from 2.5 million this year.

Boursorama is expected to register cumulative losses of about 230 million euros from 2021 to 2023 with net income of 100 million euros that year, rising to 200 million euros in 2025.

As part of profitability initiatives, Chief Executive Frederic Oudea placed SocGen's equity and credit structured products businesses under review this year after overall operations were hit by market volatility and dividend cancellations in the wake of the COVID-19 crisis.

In recent years the bank has also exited areas where it lacked scale, selling units and activities in eastern and central European countries such as Poland, Bulgaria and Albania.

Sources told Reuters that the lender is also planning to sell its asset management arm Lyxor. SocGen declined to comment on the matter.

($1 = 0.8248 euros)

(Reporting by Matthieu Protard; Additional reporting by Rachel Armstrong in London; Editing by David Goodman and Bernadette Baum)

By Matthieu Protard