SocGen quarterly profit surges as it bounces back from Russia write-downs
Paris-based lender Societe Generale posted a surge in first-quarter net profit Wednesday to €868m from €169m in the same period last year.
CAC 40
8,105.78
17:00 23/04/24
Societe Generale
€25.39
16:40 23/04/24
Societe Generale benefitted from gains in its investment banking division and a smaller hit from its struggling Russian unit. Last year, the company suffered a €525m write-down at its Russian bank, one of the country’s largest private lenders, as a deepening sanctions battle over Ukraine tipped the country into recession.
Net income at Societe Generale’s global banking and investor solutions division rose 21% to €522 million from €430m in 2014.
Commenting on the results, chairman and chief executive officer Frederic Oudea said: “Revenues were higher in all the businesses, both in French Retail Banking in a mixed environment of low interest rates where credit demand is starting to pick up and within International Retail Banking & Financial Services where growth in Africa, Eastern Europe and in Financial Services to Corporate offset the anticipated deterioration in Russia.”
Jefferies called the results “uninspiring.” It said they were in line overall, with better-than-expected revenues driven by equities partly offset by poor cost control.
“There was a lack of capital build and we continue to see limited reasons to be excited by the equity story here,” said Jefferies.
Citigroup was equally unimpressed. “Following 17% year-to-date outperformance, we believe that a lack of progress on capital ratio and a mixed set of results – with notable weakness from Russia and Corporate & Investment Banking cost pressure - suggests that the stock lacks a near-term catalyst even if valuation remains attractive.”