SocGen shares suspended after Greek write down
03 August 2011 Paris
Image: Shutterstock
Societe Generale has announced its results for the second quarter of 2011, and the first six months of the year.
Group net income totalled €747 million in Q2 2011 (€1.7 billion in the first six months of 2011) and reflects, says the bank, the global economic and financial situation which remained mixed with growing concerns over European sovereign debt resulting in risk aversion and erratic market movements, in line with political developments.
Group net income for the second quarter is down over 30 per cent from €1.1 billion from the same period last year.
“The Q2 results testify to the Group’s resilience in an uncertain economic and financial environment," said Group chairman and CEO Frédéric Oudéa. "In addition… these results incorporate the write-downs booked on Greek government bonds, whose impact is nevertheless limited, as expected."
Write-down of Greek government bonds were €395m before tax, €268m after tax.
SocGen shares on CAC40 were suspended in Wednesday morning trading.
Oudéa also stated that SocGen will have a Basel III core tier 1 ratio of at least nine per cent by the end of 2013 but that "the Group net income target of €6 billion in 2012 now appears difficult to achieve within the scheduled timeframe".
Q2 Notes:
▪ International Retail Banking’s earnings, which were impacted by the consequences of the political unrest in Africa and
the Mediterranean Basin in Q1, enjoyed a recovery.
▪ Specialised Financing and Insurance’s contribution to the Group’s results continued to grow.
▪ Corporate and Investment Banking revenues proved highly resilient given the deteriorated market environment, whereas
Private Banking, Global Investment Management and Services was impacted by an unfavourable market environment and
non-recurring provisions in Q2.
▪ Generation of 0.5 pts of capital
The most recent European bank stress tests showed that core tier 1 capital ratio would stand at 6.6 per cent compared with the 5 per cent threshold.
Group net income totalled €747 million in Q2 2011 (€1.7 billion in the first six months of 2011) and reflects, says the bank, the global economic and financial situation which remained mixed with growing concerns over European sovereign debt resulting in risk aversion and erratic market movements, in line with political developments.
Group net income for the second quarter is down over 30 per cent from €1.1 billion from the same period last year.
“The Q2 results testify to the Group’s resilience in an uncertain economic and financial environment," said Group chairman and CEO Frédéric Oudéa. "In addition… these results incorporate the write-downs booked on Greek government bonds, whose impact is nevertheless limited, as expected."
Write-down of Greek government bonds were €395m before tax, €268m after tax.
SocGen shares on CAC40 were suspended in Wednesday morning trading.
Oudéa also stated that SocGen will have a Basel III core tier 1 ratio of at least nine per cent by the end of 2013 but that "the Group net income target of €6 billion in 2012 now appears difficult to achieve within the scheduled timeframe".
Q2 Notes:
▪ International Retail Banking’s earnings, which were impacted by the consequences of the political unrest in Africa and
the Mediterranean Basin in Q1, enjoyed a recovery.
▪ Specialised Financing and Insurance’s contribution to the Group’s results continued to grow.
▪ Corporate and Investment Banking revenues proved highly resilient given the deteriorated market environment, whereas
Private Banking, Global Investment Management and Services was impacted by an unfavourable market environment and
non-recurring provisions in Q2.
▪ Generation of 0.5 pts of capital
The most recent European bank stress tests showed that core tier 1 capital ratio would stand at 6.6 per cent compared with the 5 per cent threshold.
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