Societe Generale: Second quarter 2024 earnings
RESULTS AT 30 JUNE 2024
Press
release
Paris, 1 August 2024
QUARTERLY
RESULTS
Quarterly revenues of EUR 6.7
billion, up by +6.3% vs. Q2 23, driven by an
excellent quarter for Global Markets and Transaction Banking,
increased margins at Ayvens and NII recovery underway in France
despite facing headwinds from deposit beta and a slower loan
origination in a muted environment
Positive jaws,
tight grasp on operating expenses, up by +2.9% vs. Q2 23 and by
+0.7%* at constant perimeter and exchange rates
Cost-to-income ratio at 68.4% in
Q2 24, improving by 2.2 percentage points vs. Q2
23 and 6.5 percentage points vs Q1 241
Cost of risk at 26 basis points
in Q2 24, stock of provisions on performing loans
of EUR 3.2 billion
Group net income of EUR 1.1
billion, up +24% vs. Q2 23
Profitability (ROTE) at
7.4%
FIRST HALF 2024
RESULTS
Half-year revenues of EUR 13.3
billion, up +2.9% vs. H1 23
Positive jaws,
operating expenses slightly up by +0.6% vs. H1 23, down by -3.2%*
at constant perimeter and exchange rates
Cost-to-income ratio at 71.6% in
H1 24, improving by 1.7 percentage points vs. S1
231
Profitability (ROTE) at
5.8%
SOLID CAPITAL AND LIQUIDITY
PROFILE
CET1 ratio at
13.1%2 at end of Q2
24, around 285 basis points above the regulatory
requirement, and expected to be above 13% at
end-2024
Liquidity Coverage Ratio at 152% at
end-Q2 24
Provision for distribution of EUR
0.913 per share, at end-June
2024
Completion of the 2023 share buy-back
programme of around EUR 280 million
Slawomir Krupa, the Group’s Chief
Executive Officer, commented:
“In the second quarter, our commercial and financial performance is
significantly improving, in line with our 2024 targets and our 2026
roadmap. Our revenues are driven by an excellent quarter in Global
Banking and Investor Solutions, a sustained performance of our
international retail banking activities, higher margins at Ayvens,
while the net interest income is recovering in French retail
despite being still impacted by an increasing share of
interest-bearing deposits and a slower loan origination in a muted
environment. Growth in revenues, combined with our disciplined
costs and risks management, allows us to significantly improve our
cost-to-income ratio and profitability. Our capital and liquidity
ratios remain very strong. We continue to move forward in an
orderly and efficient manner with the implementation of our
strategic roadmap, as demonstrated in the sustained development of
BoursoBank which is exceeding the 6.5 million clients threshold,
and as shown by the launch of the first phase of our 1 billion
euros investment dedicated to the energy transition. We also
continue to simplify our business portfolio and are determined to
capitalize on those positive dynamics to pursue the successful
execution of our strategic plan in order to build a more profitable
bank and create more value over the long term for all our
stakeholders.”
-
GROUP CONSOLIDATED RESULTS
|
In EURm |
Q2 24 |
Q2 23 |
Change |
H1 24 |
H1 23 |
Change |
|
Net banking income |
6,685 |
6,287 |
+6.3% |
+4.8%* |
13,330 |
12,958 |
+2.9% |
-0.5%* |
|
Operating expenses |
(4,570) |
(4,441) |
+2.9% |
+0.7%* |
(9,550) |
(9,498) |
+0.6% |
-3.2%* |
|
Gross operating income |
2,115 |
1,846 |
+14.5% |
+15.0%* |
3,780 |
3,460 |
+9.2% |
+6.8%* |
|
Net cost of risk |
(387) |
(166) |
x2.3 |
x2.3* |
(787) |
(348) |
x2.3 |
x2.2* |
|
Operating income |
1,728 |
1,680 |
+2.8% |
+3.5%* |
2,993 |
3,112 |
-3.8% |
-6.2%* |
|
Net profits or losses from other assets |
(8) |
(81) |
+90.6% |
+90.9%* |
(88) |
(98) |
+10.6% |
+5.9%* |
|
Income tax |
(379) |
(425) |
-10.8% |
-10.3%* |
(653) |
(753) |
-13.2% |
-15.9%* |
|
Net income |
1,348 |
1,181 |
+14.1% |
+15.4%* |
2,265 |
2,273 |
-0.4% |
-2.7%* |
|
O.w. non-controlling interests |
235 |
281 |
-16.5% |
-25.3%* |
472 |
506 |
-6.7% |
-20.4%* |
|
Group net income |
1,113 |
900 |
+23.7% |
+29.5%* |
1,793 |
1,768 |
+1.4% |
+2.6%* |
|
ROE |
6.5% |
4.9% |
|
|
5.1% |
4.9% |
|
|
|
ROTE |
7.4% |
5.6% |
|
|
5.8% |
5.6% |
|
|
|
Cost to income |
68.4% |
70.6% |
|
|
71.6% |
73.3% |
|
|
Societe Generale’s Board of Directors, which met
under the chairmanship of Lorenzo Bini Smaghi on 31 July 2024,
examined Societe Generale Group’s results for the second quarter
and for the first half of 2024.
Net banking
income
Net banking income stood at EUR 6.7
billion, up by +6.3% vs. Q2 23.
Revenues of French Retail, Private
Banking and Insurance were up by +1.1% vs. Q2 23 and
totalled EUR 2.1 billion in Q2 24. Still penalised by the residual
impact of short-term hedges booked until the beginning of 2022
(around EUR -150 million over the quarter), net interest income
continued to recover in Q2 24 (+10% vs. Q2 23) despite an
increasing share of interest-bearing deposits and a muted loan
environment in a competitive market on the other hand. Assets under
management in the Private Banking and Insurance
businesses increased sharply over the quarter, respectively by +6%
and +7% in Q2 24 vs. Q2 23. Last, BoursoBank
continued its sustained client acquisition with more than 300,000
new clients over the quarter, allowing to reach over 6.5 million
clients at the end of Q2 24.
Global Banking and Investor
Solutions registered a sharp +10.0% increase in revenues
in Q2 24 relative to Q2 23. Revenues totalled EUR 2.6 billion over
the quarter, driven by an excellent performance of Global
Markets and Global Transaction & Payment
Services’ activities, which increased respectively by
+15.7% and +13.5% vs. Q2 23. On Global Markets, revenues of equity
businesses grew by +24%, driven by high volumes in a conducive
environment. Fixed income and currencies businesses increased by
+3% in a context of spread tightening on rates and low volatility
on foreign exchange. Financing and Advisory turned
in a solid performance with revenues of EUR 879 million, up by 2.9%
relative to an already high level in Q2 23. Revenues were driven by
a strong quarter for securitization, a rebound in investment
banking activities and ongoing sustained commercial momentum for
financing activities. Global Transaction & Payment
Services’ activities posted a +13.5% increase in revenues
vs. Q2 23, driven by favourable market environment and a sustained
commercial development across the board.
Mobility, International
Retail Banking and Financial Services’ revenues were down
by -2.3% vs. Q2 23. International Retail
Banking’s revenues stood at EUR 1.0 billion, which is
stable vs. Q2 23, notably on the back of a favourable environment
in Romania and Africa. Revenues for the Mobility and
Financial Services’ businesses contracted by -4.0% vs. Q2
23 owing to the high base effect of around EUR 200 million on
Ayvens whose revenues notably benefited in Q2 23 from significant
positive impacts associated with reduction in depreciation costs
(around EUR +160 million in Q2 23), while they were negatively
impacted by almost EUR 40 million in Q2 24 on the back of
hyperinflation in Turkey. Excluding these items, Ayvens’ margins
increased sharply over the quarter relative to Q1 24 and the used
car sales results pursued their normalisation with an average
result per unit at EUR 1,4804 in Q2 24.
The Corporate Centre recorded
revenues of EUR -206 million in Q2 24.
Over the first half of the year, net
banking income increased by +2.9% vs. H1 23.
Operating
expenses
Operating expenses came to EUR 4,570
million in Q2 24, up +2.9% vs. Q2 23.
They include around EUR 105 million perimeter
effect from the integration of LeasePlan and Bernstein activities.
The slight increase in Q2 24 operating expenses is mainly explained
by the increase of EUR 81 million in expenses related to variable
remuneration and the employee profit sharing scheme in France, in
line with the Group’s performance. Adjusted for these items,
operating expenses decreased by EUR -56 million in Q2 24 vs. Q2
23.
The cost-to-income ratio stood at 68.4%
in Q2 24, down vs. Q2 23 (70.6%) and Q1 24 (74.9%).
Over the first half of the
year, operating expenses rose slightly (+0.6% vs. H1 23)
and the cost-to-income ratio came to 71.6% (vs. 73.3% for H1
23).
Cost of
risk
The cost of risk reached 26 basis points
in Q2 24, or EUR 387 million, which is within the
anticipated range of between 25 and 30 basis points for 2024. It
breaks down as a EUR 501 million provision for doubtful loans
(around 34 basis points), which includes the impact of specific
market files in France, and a EUR -114 million reversal on
performing loan outstandings (around -8 basis points).
At 30 June 2024, the Group’s provisions on
performing loans amounted to EUR 3,178 million, down
EUR -394 million relative to 31 December 2023, mainly owing to the
application of IFRS 5 accounting standards for activities under
disposal.
The gross non-performing loan ratio stood at
3.0%5,6 at 30 June 2024. The net
coverage ratio on the Group’s non-performing loans stood at
80%7 at 30 June 2024 (after netting of guarantees and
collateral).
Group net
income
Group net income stood at EUR 1,113
million for the quarter, up by +24% vs. Q2 23,
corresponding to a Return on Tangible Equity (ROTE) of 7.4%.
Over the first half of the year, Group
net income stood at EUR 1,793 million, equating to a
Return on Tangible Equity (ROTE) of 5.8%.
ESG
Societe Generale continues to successfully
execute its sustainability roadmap and has reached its EUR 300
billion sustainable finance target more than 18 months ahead of
schedule (initial target set between the end of 2021 and the end of
2025).
The Group is consistently recognised by
stakeholders for its leadership in ESG. It was recently rated as
the best diversified bank worldwide by Moody's ESG (with a score of
72/100) and was awarded for the "Best Transition Strategy" by
Euromoney for the third year in a row.
The recently announced acquisition of a majority
stake in Reed Management SAS illustrates the Group’s ambitions in
ESG. It bolsters the Group’s leadership in equity investment in
emerging leaders of the energy transition. This acquisition
represents a key milestone in the EUR 1 billion energy transition
investment8.
Lastly, the Group continues to strengthen the
support of its accompaniment of clients in their energy
transitions, offering them the most innovative and comprehensive
financing solutions and through new partnerships with relevant
actors of the transition.
2. THE
GROUP’S FINANCIAL STRUCTURE
At 30 June 2024, the Group’s Common
Equity Tier 1 ratio stood at 13.1%9, or around
285 basis points above the regulatory requirement. Likewise, the
Liquidity Coverage Ratio (LCR) was well above regulatory
requirements at 152% at end-June 2024 (149% on average for the
quarter), and the Net Stable Funding Ratio (NSFR) stood at 118% at
end-June 2024.
The Single Resolution Board notified Societe
Generale Group of the Minimum Requirement for Own Funds and
Eligible Liabilities (MREL) applicable from June 2024. The MREL
requirements were 23.27% of Group RWAs, in addition to the
CBR10 (vs. 22.96% previously), and at 6.23% of Group
leverage ratio exposure (vs. 6.08% previously). At end-Q2 24, the
MREL ratio stood at 33.1% of RWAs and 8.8% of leverage ratio
exposure, which is well above the regulatory requirement. In
addition, Societe Generale has chosen to waive the possibility
offered by Article 72b(3) of the Capital Requirements Regulation to
use senior preferred debt for compliance with its TLAC
requirement.
All liquidity and solvency ratios are well above the regulatory
requirements.
|
|
30/06/2024 |
31/12/2023 |
Current requirements |
|
CET1(1) |
13.1% |
13.1% |
10.26% |
|
CET1 fully loaded |
13.1% |
13.1% |
10.26% |
|
Tier 1 ratio |
15.7% |
15.6% |
12.19% |
|
Total Capital(1) |
18.5% |
18.2% |
14.75% |
|
Leverage ratio |
4.2% |
4.3% |
3.6% |
|
TLAC (% RWA)(1) |
28.4% |
31.9% |
22.33% |
|
TLAC (% leverage)(1) |
7.5% |
8.7% |
6.75% |
|
MREL (% RWA)(1) |
33.1% |
33.7% |
27.60% |
|
MREL (% leverage)(1) |
8.8% |
9.2% |
6.23% |
|
End of period LCR |
152% |
160% |
>100% |
|
Period average LCR |
149% |
155% |
>100% |
|
NSFR |
118% |
119% |
>100% |
|
In EURbn |
30/06/2024 |
31/12/2023 |
|
Total consolidated balance sheet |
1,592 |
1,554 |
|
Group shareholders’ equity |
67 |
66 |
|
Risk-weighted assets |
389 |
389 |
|
O.w. credit risk |
327 |
326 |
|
Total funded balance sheet |
965 |
970 |
|
Customer loans |
466 |
497 |
|
Customer deposits |
620 |
618 |
At 17 July 2024, the parent company has issued a
total of 34.0 billion of medium medium/long-term debt, of which EUR
17.6 billion of vanilla notes. The subsidiaries had issued EUR 4.0
billion. In all, the Group has issued a total of EUR 38.0 billion
of medium/long-term notes.
The Group is rated by four rating agencies: (i)
FitchRatings - long-term rating “A-”, positive outlook, senior
preferred debt rating “A”, short-term rating “F1” (ii) Moody’s -
long-term rating (senior preferred debt) “A1”, negative outlook,
short-term rating “P-1” (iii) R&I - long-term rating (senior
preferred debt) “A”, stable outlook; and (iv) S&P Global
Ratings - long-term rating (senior preferred debt) “A”, stable
outlook, short-term rating “A-1”.
3. FRENCH RETAIL,PRIVATE
BANKING AND INSURANCE
|
In EURm |
Q2 24 |
Q2 23 |
Change |
H1 24 |
H1 23 |
Change |
|
Net banking income |
2,125 |
2,103 |
+1.1% |
4,136 |
4,189 |
-1.3% |
|
Net banking income excl. PEL/CEL |
2,122 |
2,099 |
+1.1% |
4,133 |
4,195 |
-1.5% |
|
Operating expenses |
(1,649) |
(1,618) |
+1.9% |
(3,377) |
(3,464) |
-2.5% |
|
Gross operating income |
476 |
485 |
-1.7% |
759 |
725 |
+4.7% |
|
Net cost of risk |
(173) |
(110) |
+57.1% |
(420) |
(198) |
x 2.1 |
|
Operating income |
304 |
375 |
-19.0% |
339 |
527 |
-35.6% |
|
Net profits or losses from other assets |
8 |
(1) |
n/s |
8 |
3 |
x 2.4 |
|
Group net income |
236 |
279 |
-15.4% |
263 |
396 |
-33.6% |
|
RONE |
6.0% |
7.3% |
|
3.4% |
5.1% |
|
|
Cost to income |
77.6% |
77.0% |
|
81.7% |
82.7% |
|
Commercial
activity
SG Network, Private Banking and
Insurance
Average outstanding deposits of the SG Network
amounted to EUR 235 billion in Q2 24. Deposits increased by EUR 2
billion relative to Q1 24 (-2% vs. Q2 23), with a rise in
interest-bearing deposits and financial savings.
The SG Network’s average loan outstandings
contracted by -5% on the Q2 23 level to EUR 197 billion.
Outstanding loans to corporate and professional clients were stable
vs. Q2 23, excluding government-guaranteed PGE loans, the latter
having contracted by EUR 3 billion vs. Q2 23. Home loan production
continued its recovery, with a +49% increase over the quarter
relative to Q2 23, to levels that are still nonetheless around 65%
lower compared with 2021’s quarterly average.
As a result, the average loan to deposit ratio
came to 83.8% in Q2 24, down 2.7 percentage points compared to Q2
23.
Private Banking activities,
which include French and international activities, posted record
assets under management (AuM) of EUR 152 billion in Q2 24. The net
asset gathering pace (annualized net new money divided by AuM) has
risen by +6% since the start of the year, with net asset inflows
totalling EUR 2.2 billion in Q2 24. Net banking income came to EUR
377 million over the quarter, which is a -0.9% decrease vs.
Q2 23, and to EUR 753 million over the first half of the year,
a +0.7% increase vs. H1 23.
Insurance, which includes
French and international activities, posted very solid commercial
performances. Life insurance outstandings increased by +7% vs. Q2
23 to reach a record of EUR 143 billion at end-June 2024. The
unit-linked portion of 39% remains at a high level and rose by +1
percentage points vs. Q2 23. Gross life insurance savings inflows
amounted to EUR 5.3 billion in Q2 24, up sharply by +67% vs. Q2
23.
Risk life and property & casualty premia
grew by +3% vs. Q2 23.
BoursoBank
BoursoBank maintained a high acquisition pace
with more than 300,000 new clients in Q2 24, in line with its
strategic ambitions. The Bank demonstrates an efficient and well
monitored clients onboarding, with a -14% decrease in client
acquisition costs over the quarter compared with previous quarter.
The number of clients at BoursoBank topped 6.5 million at the end
of June 2024, a +31% increase vs. Q2 23.
As in previous quarters, BoursoBank continued to
gain market share and posted a lower churn rate of around 3%, which
is below the market rate.
Average loan outstandings were stable compared with Q2 23 level, at
EUR 15 billion in Q2 24. The rebound in loan production was
confirmed in Q2 24, both for home loans (+23.9% vs. Q1 24) and
consumer loans (+12.8% vs. Q1 24), albeit at lower levels than in
2021.
Average outstanding savings including deposits
and financial savings registered an increase by +14.6% vs. Q2 23,
to EUR 61 billion. Average deposit outstandings totalled
EUR 37 billion in Q2 24, on the back of a sharp increase in deposit
inflows over the period (+17.1% vs. Q2 23) thanks to robust inflow
momentum on interest-bearing deposits. Life insurance posted
average outstandings of EUR 12 billion in Q2 24 (o/w 46%
unit-linked products, a +3.8 percentage-point increase vs. Q2 23),
up by a sharp +6.5% vs. Q2 23 owing to high gross savings insurance
inflows over the quarter (+62.0% vs. Q2 23). The brokerage
activity registered more than 2.2 million transactions during the
quarter (+42% vs. Q2 23).
Revenues (excluding PEL/CEL and client
acquisition costs) rose by over +9.1% relative to Q2 23.
Net banking
income
Over the quarter, revenues came
to EUR 2,125 million, up +1.1% vs. Q2 23, excluding PEL/CEL. Net
interest income for French Retail, Private Banking and Insurance
increased by +10.6% vs. Q2 23 (+8.6% vs. Q1 24) to EUR
893 million in Q2 24 (including PEL/CEL). Fees11
were stable in Q2 23, but rose by +2.3% excluding BoursoBank client
acquisition costs (+1.3% vs. Q1 24).
Over the first half of
the year, revenues came to EUR 4,136 million, down -1.5%
vs. H1 23, excluding PEL/CEL. Net interest income excluding PEL/CEL
was up by +3.7% vs. H1 23. Fee income1 was up by +0.6% relative to
H1 23.
In the second quarter, the share of
interest-bearing deposits continued to increase and the loan
environment stayed subdued in a market that remained competitive.
In this context and based on the latest assumptions, the net
interest income for French Retail, Private Banking and Insurance is
expected, in our best estimate, around EUR 3.8 billion for
2024.
Operating
expenses
Over the quarter, operating
expenses came to EUR 1,649 million, up +1.9% vs. Q2 23. Adjusted
for the reversal of one-off EUR 60 million booked in Q2 23, they
contracted by -1.7%. Operating expenses for Q2 24 included EUR 45
million in transformation costs. The cost-to-income ratio reached
77.6% in Q2 24.
Over the first half of the
year, operating expenses totalled EUR 3,377 million (-2.5%
vs. H1 23). The cost-to-income ratio stood at 81.7% and improved by
1 percentage point vs. H1 23.
Cost of
risk
Over the quarter, the cost of
risk amounted to EUR 173 million or 29 basis points, which was
lower than in Q1 24 (41 basis points).
Over the first half of the
year, the cost of risk totalled EUR 420 million, or 35
basis points.
Group net
income
Over the quarter, Group net
income totalled EUR 236 million. RONE stood at 6.0% in Q2 24.
Over the first half of the
year, Group net income totalled EUR 263 million. RONE
stood at 3.4% in H1 24.
4. GLOBAL BANKING AND
INVESTOR SOLUTIONS
|
In EUR m |
Q2 24 |
Q2 23 |
Variation |
H1 24 |
H1 23 |
Change |
|
Net banking income |
2,621 |
2,383 |
+10.0% |
+8.6%* |
5,244 |
5,148 |
+1.9% |
+1.3%* |
|
Operating expenses |
(1,647) |
(1,638) |
+0.6% |
-0.6%* |
(3,404) |
(3,709) |
-8.2% |
-8.7%* |
|
Gross operating income |
973 |
745 |
+30.6% |
+28.9%* |
1,840 |
1,439 |
+27.9% |
+26.9%* |
|
Net cost of risk |
(21) |
27 |
n/s |
n/s |
(1) |
22 |
n/s |
n/s |
|
Operating income |
952 |
772 |
+23.3% |
+21.7%* |
1,839 |
1,461 |
+25.8% |
+24.8%* |
|
Reported Group net income |
770 |
620 |
+24.3% |
+23.1%* |
1,462 |
1,168 |
+25.1% |
+24.3%* |
|
RONE |
20.4% |
16.2% |
+0.0% |
+0.0%* |
19.5% |
15.0% |
+0.0% |
+0.0%* |
|
Cost to income |
62.9% |
68.7% |
+0.0% |
+0.0%* |
64.9% |
72.1% |
+0.0% |
+0.0%* |
Net banking
income
Global Banking and Investor
Solutions again delivered a very strong performance in the
second quarter, posting revenues of EUR 2,621million, up +10.0%
with respect to Q2 23.
Over the first half of
the year revenues grew by +1.9% vs. H1 23 (EUR 5,244
million vs. EUR 5,148 million).
Global Markets and Investor
Services recorded a rise in revenues of +14.0% to EUR
1,742 million over the quarter vs. Q2 23. Over H1 24, revenues
totalled EUR 3,485 million, i.e., a slight +1.1% increase vs.
H1 23. This growth was driven by Global
Markets which realized a very strong performance, posting
revenues of EUR 1,560 million in Q2 24 (up by a sharp +15.7% vs. Q2
23) thanks to conducive market conditions, notably for equities. In
H1 24, revenues were up +2.8% in comparison to H1 23 at EUR 3,142
million.
The Equities
business again delivered an excellent performance,
posting revenues of EUR 989 million in Q2 24, up +24.4% vs. Q2 23.
The business benefited from positive market conditions across all
activities. Over the first half of the year revenues grew by +14.2%
vs. H1 23 at EUR 1,858 million.
Fixed Income and Currencies
registered a good performance with revenues up by +3.0% to
EUR 571 million, notably owing to supportive client
activity in the investment solutions business which more than
offset the contraction in flow and hedging activities in a context
of tighter spreads in rates and low volatility on foreign exchange
rates. In H1 24 revenues were down -10.3% versus H1 23 at EUR 1,284
million.
Securities Services’ revenues
were up +1.1% in Q2 24 at EUR 181 million, but increased by +2.0%
excluding the impact of equity participations. Positive trend in
fee generation, but net interest income remained penalised by the
end of the remuneration of minimum reserve. Over the first half of
the year, revenues were down -12.0% and -1.4% excluding equity
participations. Assets under Custody and Assets under
Administration amounted to EUR 4,808 billion and EUR 598 billion,
respectively.
The Financing and Advisory
business posted revenues of EUR 879 million, up +2.9% vs.
Q2 23. Over the first half of the year, the contribution to Group
revenues totalled EUR 1,760 million, up by 3.4% vs. H1 23.
The Global Banking and Advisory
revenues were broadly stable relative to Q2 23. The business was
notably driven by the Asset-Backed Products platform which
delivered an excellent quarter and by a sharp rebound in the
Investment Banking business that was driven by Merger &
Acquisitions and Debt Capital Markets. However, volumes remained
low in the Equity Capital Markets activity. Financing activities
posted a sustained performance that was slightly down on the high
baseline in Q2 23. Over the first half of the year, revenues grew
by +1.1% vs. H1 23.
Global Transaction & Payment
Services again turned in a very robust performance
compared with Q2 23, posting a sharp +13.5% increase in
revenues driven by strong commercial momentum and durably
favourable market conditions amid ongoing high interest rates. In
H1 24, revenues were up +10.6% versus H1 23.
Operating
expenses
Operating expenses came to EUR 1,647
million over the quarter and included EUR 29
million in transformation costs. Operating expenses rose
slightly by +0.6% relative to Q2 23 and up +5.5% restated from Q2
23 one-offs and perimeter effect. The cost-to-income ratio came to
62.9% over the quarter.
Over the first half of 2024,
operating expenses contracted by -8.2% compared with H1 23
translating into a cost-to-income ratio, which came to 64.9% in H1
24.
Cost of
risk
Over the quarter, the cost of
risk was a very low EUR 21 million, or 5 basis points.
Over the first half of the
year, the cost of risk was EUR 1 million, or 0 basis
points.
Group net
income
Group net income totalled EUR 770
million in Q2 24, up strongly by +24.3% vs. Q2 23. Over
the first half of the year, Group net income rose by +25.1% to EUR
1,462 million.
Global Banking and Investor Solutions reported
RONE of 20.4% for the quarter and RONE of 19.5% for the
first half of the year.
5. MOBILITY,
INTERNATIONAL RETAIL BANKING AND FINANCIAL SERVICES
|
In EURm |
Q2 24 |
Q2 23 |
Change |
H1 24 |
H1 23 |
Change |
|
Net banking income |
2,145 |
2,196 |
-2.3% |
-5.7%* |
4,295 |
4,263 |
+0.8% |
-9.3%* |
|
Operating expenses |
(1,261) |
(1,153) |
+9.3% |
+3.4%* |
(2,611) |
(2,240) |
+16.6% |
+2.7%* |
|
Gross operating income |
884 |
1,043 |
-15.2% |
-15.6%* |
1,684 |
2,023 |
-16.8% |
-22.7%* |
|
Net cost of risk |
(189) |
(83) |
x 2.3 |
x 2.2* |
(370) |
(174) |
x 2.1 |
x 2.0* |
|
Operating income |
696 |
960 |
-27.5% |
-27.6%* |
1,313 |
1,849 |
-29.0% |
-34.7%* |
|
Non-controlling interests |
208 |
247 |
-15.9% |
-25.6%* |
400 |
437 |
-8.4% |
-24.1%* |
|
Reported Group net income |
316 |
473 |
-33.3% |
-28.6%* |
589 |
948 |
-37.9% |
-40.0%* |
|
RONE |
12.1% |
20.5% |
|
|
11.3% |
20.6% |
|
|
|
Cost to income |
58.8% |
52.5% |
|
|
60.8% |
52.5% |
|
|
Commercial
businesses
International Retail
Banking
International Retail
Banking12 continued its solid
performance in Q2 24, recording loan outstandings of EUR 67
billion, an increase of +1.4% compared with Q2 23 (+4.5%* vs. Q2
23). Outstanding deposits totalled EUR 83 billion in Q2 24, an
increase of +2.9% compared with Q2 23 (+6.5%* vs. Q2 23).
Europe posted solid commercial
momentum in all client segments for both entities, with growth in
total loan outstandings of +1.5% vs. Q2 23 (+5.9%*, outstandings of
EUR 42 billion in Q2 24) and growth of +3.3% in outstanding
deposits vs. Q2 23 (+7.7%*, outstandings of EUR 55 billion in Q2
24).
In Africa, Mediterranean Basin and
French Overseas Territories loan outstandings were up by
+2.2%* vs. Q2 23, with outstandings of EUR 25 billion in Q2 24.
Deposit outstandings stood at EUR 28 billion in Q2 24. They
increased overall by +4.2%* vs. Q2 23, with observable growth in
all segments across both the Mediterranean Basin and sub-Saharan
Africa.
Mobility and Financial
Services
Overall, Mobility and Financial
Services recorded good commercial performances.
Ayvens’ earning assets totalled EUR 53.2 billion
at end-June 2024, around +10% increase vs. end-June 2023 (around
+1% vs. Q1 24).
The Consumer Finance business
posted loans outstanding of EUR 23 billion at Q2 24, down -4.2%
vs. Q2 23 amid a durably challenging environment, notably
in France.
The Equipment Finance
outstandings at EUR 15 billion in Q2 24, recorded a slight rise
relative to the year-earlier period.
Net banking
income
Over the quarter,
Mobility, International Retail Banking and
Financial Services’ revenues decreased by -2.3% vs. Q2 23
to EUR 2,145 million.
Over the first half of the
year, revenues were at EUR 4,295 million, up by +0.8%
compared with the first six months of 2023.
International Retail Banking’s
net banking income was stable for the quarter vs. Q2 23 at
EUR 1,040 million but up by +3.5%* at constant perimeter
and exchange rates. Over the first half of the year, revenues came
to EUR 2,073 million, stable vs. H1 23 and up +3.5%* at constant
perimeter and exchange rates.
Europe posted solid revenues of
EUR 492 million for the second quarter of 2024, slightly up by
+0.8%* vs. Q2 23 (-3.3% at current exchange rates). Revenues were
driven by high fee income generated by KB and increased net
interest income in Romania, in contrast to the Czech Republic where
banks’ net interest income was negatively impacted by the end of
remuneration of minimum reserves.
Net banking income in Africa,
Mediterranean Basin and French Overseas
Territories rose by +5.9%* vs. Q2 23 to EUR 547 million in
Q2 24, driven by a sharp increase in fee income and a rise in net
interest income vs. Q2 23.
In Q2 24, Mobility and Financial
Services’ revenues decreased by -4.0% vs. Q2 23 to EUR
1,105 million. Over the first half of the year, they rose by +1.7%
to EUR 2,222 million.
Ayvens’ net banking income
decreased by -4.2%13 in Q2 24 vs. Q2
23. It includes changes in the perimeter and negative base effects
on non-recurring items. Compared to Q1 24, revenues restated from
non-recurring items increased by
+4.5%14. Ayvens posted a margin of 539
basis points15 this quarter, increasing
relative to Q1 24 (522 basis points)3, and generated EUR
27 million of additional synergies in line with the annual target
of EUR 120 million (EUR 47 million in H1 24). The average used car
sales result per vehicle (UCS) continued to normalise to EUR
1,48016 per unit in Q2 24 (excluding
the impact of reduction in depreciation costs and Purchase Price
Allocation) vs. EUR 1,661 in Q1 244.
Outstandings for the Consumer
Finance business decreased by -4,2% relative to Q2 23,
with revenues negatively impacted by a durably challenging
environment, notably in France, which resulted in a -4.9%
contraction in net banking income in Q2 24 vs. Q2 23.
Equipment Finance posted a net banking income
stable over the same period.
Operating
expenses
Over the quarter, operating
expenses came to EUR 1,261 million, up by +9,3% vs. Q2 23 (+3,4%*
at constant perimeter and exchange rates). They include the
integration of LeasePlan costs over a full quarter and EUR 50
million of transformation charges. The cost-to-income ratio came to
58.8% in Q2 24.
Over the first half of the
year, operating expenses came to EUR 2,611 million, up
+16.6% vs. H1 23.
International Retail Banking
recorded a controlled rise in operating expenses of +2.7% vs. Q2 23
amid an inflationary environment (EUR 596 million in Q2 24).
The Mobility and Financial
Services business recorded a +16.0% increase in operating
expenses over the quarter vs. Q2 23 at EUR 665 million, owing
notably to the integration of LeasePlan costs and related
transformation costs. Operating expenses were stable* vs. Q2 23 at
constant perimeter and exchange rates.
Cost of
risk
Over the quarter, the cost of
risk normalised to 45 basis points (or EUR 189 million).
Over the first half of
the year, the cost of risk stood at 44 basis points.
Group net
income
Over the quarter, Group net
income came to EUR 316 million. RONE was at 12.1% for the pillar in
Q2 24,15.4% in International Retail Banking, and 10.0% in
Mobility and Financial Services.
Over the first half of the
year, Group net income came to EUR 589 million. RONE stood
at 11.3% in H1 24. RONE was 13.8% in International Retail
Banking, and 9.7% in Mobility and Financial Services in
H1 24.
6. CORPORATE
CENTRE
|
In EURm |
Q2 24 |
Q2 23 |
Change |
H1 24 |
H1 23 |
Change |
|
Net banking income |
(206) |
(395) |
+47.7% |
+48.5%* |
(345) |
(642) |
+46.3% |
+47.0%* |
|
Operating expenses |
(13) |
(32) |
-57.9% |
-69.4%* |
(158) |
(85) |
+87.3% |
+78.8%* |
|
Gross operating income |
(220) |
(426) |
+48.5% |
+50.1%* |
(503) |
(727) |
+30.8% |
+32.5%* |
|
Net cost of risk |
(4) |
(0) |
n/s |
n/s |
5 |
2 |
n/s |
n/s |
|
Net profits or losses from other assets |
(15) |
(80) |
+81.1% |
+81.1%* |
(99) |
(100) |
+1.2% |
+1.2%* |
|
Income tax |
61 |
57 |
-6.6% |
-2.5%* |
145 |
129 |
-12.0% |
-8.8%* |
|
Reported Group net income |
(209) |
(472) |
+55.7% |
+56.9%* |
(521) |
(745) |
+30.2% |
+31.5%* |
The Corporate Centre includes:
- the property management of the
Group’s head office,
- the Group’s equity portfolio,
- the Treasury function for the
Group,
- certain costs related to
cross-functional projects, as well as several costs incurred by the
Group that are not re-invoiced to the businesses.
Net banking
income
The Corporate Centre’s net banking
income totalled EUR -206 million in Q2 24 vs. EUR -395
million in Q2 23.
Operating
expenses
Operating expenses totalled EUR -13
million in Q2 24 vs. EUR -32 million in Q2 23.
Group net
income
The Corporate Centre’s Group net income
totalled EUR -209 million in Q2 24 vs. EUR -472 million in
Q2 23.
Societe Generale received at the end of July
2024 proceeds of EUR 301 million closing out its remaining
exposures in Russia linked to its past local presence through
Rosbank. Those exposures which were either valued at zero or
provisioned in the Group accounts, have been recovered in
accordance with applicable regulations and after approvals of
regulatory authorities. The financial elements linked to this
operation will be booked in the third quarter 2024 accounts, they
will generate a positive contribution to the Group net income
comprised between EUR 200 and EUR 250 million after tax.
7. 2024 AND 2025
FINANCIAL CALENDAR
2024 and 2025 Financial communication calendar
|
31 October, 2024 Third quarter and nine month 2024 results
6 February, 2025 Fourth quarter and full year 2024 results
30 April, 2025 First quarter 2025 results |
The Alternative Performance Measures, notably the notions
of net banking income for the pillars, operating expenses, cost of
risk in basis points, ROE, ROTE, RONE, net assets and tangible net
assets are presented in the methodology notes, as are the
principles for the presentation of prudential ratios.
This document contains forward-looking statements relating to the
targets and strategies of the Societe Generale Group.
These forward-looking statements are based on a series of
assumptions, both general and specific, in particular the
application of accounting principles and methods in accordance with
IFRS (International Financial Reporting Standards) as adopted in
the European Union, as well as the application of existing
prudential regulations.
These forward-looking statements have also been developed from
scenarios based on a number of economic assumptions in the context
of a given competitive and regulatory environment. The Group may be
unable to:
- anticipate all the risks, uncertainties or other factors likely
to affect its business and to appraise their potential
consequences;
- evaluate the extent to which the occurrence of a risk or a
combination of risks could cause actual results to differ
materially from those provided in this document and the related
presentation.
Therefore, although Societe Generale believes that these statements
are based on reasonable assumptions, these forward-looking
statements are subject to numerous risks and uncertainties,
including matters not yet known to it or its management or not
currently considered material, and there can be no assurance that
anticipated events will occur or that the objectives set out will
actually be achieved. Important factors that could cause actual
results to differ materially from the results anticipated in the
forward-looking statements include, among others, overall trends in
general economic activity and in Societe Generale’s markets in
particular, regulatory and prudential changes, and the success of
Societe Generale’s strategic, operating and financial
initiatives.
More detailed information on the potential risks that could affect
Societe Generale’s financial results can be found in the section
“Risk Factors” in our Universal Registration Document filed with
the French Autorité des Marchés Financiers (which is available on
https://investors.societegenerale.com/en).
Investors are advised to take into account factors of uncertainty
and risk likely to impact the operations of the Group when
considering the information contained in such forward-looking
statements. Other than as required by applicable law, Societe
Generale does not undertake any obligation to update or revise any
forward-looking information or statements. Unless otherwise
specified, the sources for the business rankings and market
positions are internal. |
8. APPENDIX 1: FINANCIAL
DATA
GROUP NET INCOME BY CORE
BUSINESS
|
In EURm |
Q2 24 |
Q2 23 |
Variation |
H1 24 |
H1 23 |
Variation |
|
French Retail, Private Banking and Insurance |
236 |
279 |
-15.4% |
263 |
396 |
-33.6% |
|
Global Banking and Investor Solutions |
770 |
620 |
+24.3% |
1,462 |
1,168 |
+25.1% |
|
Mobility, International Retail Banking & Financial
Services |
316 |
473 |
-33.3% |
589 |
948 |
-37.9% |
|
Core Businesses |
1,322 |
1,372 |
-3.7% |
2,313 |
2,513 |
-7.9% |
|
Corporate Centre |
(209) |
(472) |
+55.7% |
(521) |
(745) |
+30.2% |
|
Group |
1,113 |
900 |
+23.7% |
1,793 |
1,768 |
+1.4% |
MAIN EXCEPTIONAL
ITEMS
|
In EURm |
Q2 24 |
Q2 23 |
H1 24 |
H1 23 |
|
Net Banking Income - Total exceptional items |
0 |
(240) |
0 |
(240) |
|
One-off legacy items - Corporate Centre |
0 |
(240) |
0 |
(240) |
|
|
|
|
|
|
|
Operating expenses - Total one-off items and transformation
charges |
(124) |
(271) |
(476) |
(517) |
|
Transformation charges |
(124) |
(236) |
(476) |
(482) |
|
Of which French Retail, Private Banking and Insurance |
(45) |
(134) |
(127) |
(284) |
|
Of which Global Banking & Investor Solutions |
(29) |
(32) |
(183) |
(61) |
|
Of which Mobility, International Retail Banking & Financial
Services |
(50) |
(70) |
(119) |
(137) |
|
Of which Corporate Centre |
0 |
0 |
(47) |
0 |
|
One-off items |
0 |
(35) |
0 |
(35) |
|
|
|
|
|
|
|
Other one-off items - Total |
0 |
(79) |
0 |
(79) |
|
Net profits or losses on other assets - Disposals |
0 |
(79) |
0 |
(79) |
CONSOLIDATED BALANCE
SHEET
|
In EUR m |
|
30.06.2024 |
31.12.2023 |
|
Cash, due from central banks |
|
223,220 |
223,048 |
|
Financial assets at fair value through profit or loss |
|
530,826 |
495,882 |
|
Hedging derivatives |
|
5,352 |
10,585 |
|
Financial assets at fair value through other comprehensive
income |
|
92,138 |
90,894 |
|
Securities at amortised cost |
|
30,353 |
28,147 |
|
Due from banks at amortised cost |
|
78,415 |
77,879 |
|
Customer loans at amortised cost |
|
455,438 |
485,449 |
|
Revaluation differences on portfolios hedged against interest rate
risk |
|
(1,259) |
(433) |
|
Insurance and reinsurance contracts assets |
|
473 |
459 |
|
Tax assets |
|
4,583 |
4,717 |
|
Other assets |
|
77,131 |
69,765 |
|
Non-current assets held for sale |
|
28,661 |
1,763 |
|
Investments accounted for using the equity method |
|
387 |
227 |
|
Tangible and intangible fixed assets |
|
61,356 |
60,714 |
|
Goodwill |
|
5,070 |
4,949 |
|
Total |
|
1,592,144 |
1,554,045 |
|
In EUR m |
|
30.06.2024 |
31.12.2023 |
|
Due to central banks |
|
9,522 |
9,718 |
|
Financial liabilities at fair value through profit or loss |
|
407,702 |
375,584 |
|
Hedging derivatives |
|
12,189 |
18,708 |
|
Debt securities issued |
|
161,886 |
160,506 |
|
Due to banks |
|
105,778 |
117,847 |
|
Customer deposits |
|
540,355 |
541,677 |
Revaluation differences on portfolios hedged
against interest rate risk |
|
(6,994) |
(5,857) |
|
Tax liabilities |
|
2,405 |
2,402 |
|
Other liabilities |
|
97,255 |
93,658 |
|
Non-current liabilities held for sale |
|
19,219 |
1,703 |
|
Insurance contracts related liabilities |
|
146,420 |
141,723 |
|
Provisions |
|
4,143 |
4,235 |
|
Subordinated debts |
|
15,852 |
15,894 |
|
Total liabilities |
|
1,515,732 |
1,477,798 |
|
Shareholder's equity |
|
- |
- |
|
Shareholders' equity, Group share |
|
- |
- |
|
Issued common stocks and capital reserves |
|
20,966 |
21,186 |
|
Other equity instruments |
|
9,357 |
8,924 |
|
Retained earnings |
|
34,207 |
32,891 |
|
Net income |
|
1,793 |
2,493 |
|
Sub-total |
|
66,323 |
65,494 |
|
Unrealised or deferred capital gains and losses |
|
506 |
481 |
|
Sub-total equity, Group share |
|
66,829 |
65,975 |
|
Non-controlling interests |
|
9,583 |
10,272 |
|
Total equity |
|
76,412 |
76,247 |
|
Total |
|
1,592,144 |
1,554,045 |
9. APPENDIX 2:
METHODOLOGY
1 - The financial information presented
for the second quarter and first half 2024 was examined by the
Board of Directors on July
31st, 2024
and has been prepared in accordance with IFRS as adopted in the
European Union and applicable at that date. The limited review
procedures on the condensed interim statement at 30 June 2024
carried by the Statutory Auditors are currently underway.
2 - Net banking income
The pillars’ net banking income is defined on
page 42 of Societe Generale’s 2024 Universal Registration Document.
The terms “Revenues” or “Net Banking Income” are used
interchangeably. They provide a normalised measure of each pillar’s
net banking income taking into account the normative capital
mobilised for its activity.
3 - Operating expenses
Operating expenses correspond to the “Operating
Expenses” as presented in note 5 to the Group’s consolidated
financial statements as at December 31st, 2023. The term
“costs” is also used to refer to Operating Expenses. The
Cost/Income Ratio is defined on page 42 of Societe Generale’s 2024
Universal Registration Document.
4 - Cost of risk in basis points,
coverage ratio for doubtful outstandings
The cost of risk is defined on pages 43 and 770
of Societe Generale’s 2024 Universal Registration Document. This
indicator makes it possible to assess the level of risk of each of
the pillars as a percentage of balance sheet loan commitments,
including operating leases.
|
In EURm |
|
Q2 24 |
Q2 23 |
H1 24 |
H1 23 |
French Retail, Private Banking and Insurance
|
Net Cost Of Risk |
173 |
109 |
420 |
198 |
|
Gross loan Outstandings |
236,044 |
249,843 |
237,219 |
251,266 |
|
Cost of Risk in bp |
29 |
18 |
35 |
16 |
Global Banking and Investor Solutions
|
Net Cost Of Risk |
21 |
(27) |
1 |
(22) |
|
Gross loan Outstandings |
164,829 |
165,847 |
163,643 |
171,719 |
|
Cost of Risk in bp |
5 |
(7) |
0 |
(3) |
Mobility, International Retail Banking & Financial
Services
|
Net Cost Of Risk |
189 |
83 |
370 |
174 |
|
Gross loan Outstandings |
166,967 |
137,819 |
167,429 |
136,404 |
|
Cost of Risk in bp |
45 |
24 |
44 |
26 |
Corporate Centre
|
Net Cost Of Risk |
4 |
1 |
(5) |
(2) |
|
Gross loan Outstandings |
24,583 |
18,873 |
23,974 |
17,705 |
|
Cost of Risk in bp |
6 |
2 |
(5) |
(2) |
Societe Generale Group
|
Net Cost Of Risk |
387 |
166 |
787 |
348 |
|
Gross loan Outstandings |
592,422 |
572,382 |
592,265 |
577,093 |
|
Cost of Risk in bp |
26 |
12 |
27 |
12 |
The gross coverage ratio for doubtful
outstandings is calculated as the ratio of provisions
recognised in respect of the credit risk to gross outstandings
identified as in default within the meaning of the regulations,
without taking account of any guarantees provided. This coverage
ratio measures the maximum residual risk associated with
outstandings in default (“doubtful”).
5 - ROE, ROTE, RONE
The notions of ROE (Return on Equity) and ROTE
(Return on Tangible Equity), as well as their calculation
methodology, are specified on pages 43 and 44 of Societe Generale’s
2024 Universal Registration Document. This measure makes it
possible to assess Societe Generale’s return on equity and return
on tangible equity.
RONE (Return on Normative Equity) determines the return on average
normative equity allocated to the Group’s businesses, according to
the principles presented on page 44 of Societe Generale’s 2024
Universal Registration Document.
Group net income used for the ratio numerator is the accounting
Group net income adjusted for “Interest paid and payable to holders
if deeply subordinated notes and undated subordinated notes, issue
premium amortisation”. For ROTE, income is also restated for
goodwill impairment.
Details of the corrections made to the accounting equity in order
to calculate ROE and ROTE for the period are given in the table
below:
ROTE calculation: calculation
methodology
|
End of period (in EURm) |
Q2 24 |
Q2 23 |
H1 24 |
H1 23 |
|
Shareholders' equity Group share |
66,829 |
68,007 |
66,829 |
68,007 |
|
Deeply subordinated and undated subordinated notes |
(9,747) |
(10,815) |
(9,747) |
(10,815) |
|
Interest payable to holders of deeply & undated subordinated
notes, issue premium amortisation(1) |
(19) |
(28) |
(19) |
(28) |
|
OCI excluding conversion reserves |
705 |
688 |
705 |
688 |
|
Distribution provision(2) |
(718) |
(982) |
(718) |
(982) |
|
Distribution N-1 to be paid |
- |
(441) |
- |
(441) |
|
ROE equity end-of-period |
57,050 |
56,430 |
57,050 |
56,430 |
|
Average ROE equity |
56,797 |
56,334 |
56,660 |
56,203 |
|
Average Goodwill(3) |
(4,073) |
(4,041) |
(4,040) |
(3,847) |
|
Average Intangible Assets |
(2,937) |
(3,117) |
(2,947) |
(2,997) |
|
Average ROTE equity |
49,787 |
49,176 |
49,673 |
49,359 |
|
|
|
|
|
|
|
Group net Income |
1,113 |
900 |
1,793 |
1,768 |
|
Interest paid and payable to holders of deeply subordinated notes
and undated subordinated notes, issue premium amortisation |
(190) |
(216) |
(356) |
(379) |
|
Cancellation of goodwill impairment |
- |
- |
- |
- |
|
Adjusted Group net Income |
923 |
684 |
1,437 |
1,390 |
|
ROTE |
7.4% |
5.6% |
5.8% |
5.6% |
171819
RONE calculation: Average capital
allocated to Core Businesses (in EURm)
|
In EURm |
Q2 24 |
Q2 23 |
Change |
H1 24 |
H1 23 |
Change |
|
French Retail , Private Banking and Insurance |
15,642 |
15,219 |
+2.8% |
15,560 |
15,403 |
+1.0% |
|
Global Banking and Investor Solutions |
15,125 |
15,340 |
-1.4% |
14,978 |
15,567 |
-3.8% |
|
Mobility, International Retail Banking & Financial
Services |
10,413 |
9,222 |
+12.9% |
10,417 |
9,190 |
+13.3% |
|
Core Businesses |
41,180 |
39,782 |
+3.5% |
40,955 |
40,160 |
+2.0% |
|
Corporate Center |
15,617 |
16,552 |
-5.6% |
15,705 |
16,043 |
-2.1% |
|
Group |
56,797 |
56,334 |
+0.8% |
56,660 |
56,203 |
+0.8% |
6 - Net assets and tangible net
assets
Net assets and tangible net assets are defined
in the methodology, page 45 of the Group’s 2024 Universal
Registration Document. The items used to calculate them are
presented below:
2021
|
End of period (in EURm) |
H1 24 |
Q1 24 |
2023 |
|
Shareholders' equity Group share |
66,829 |
67,342 |
65,975 |
|
Deeply subordinated and undated subordinated notes |
(9,747) |
(10,166) |
(9,095) |
|
Interest of deeply & undated subordinated notes, issue premium
amortisation(1) |
(19) |
(71) |
(21) |
|
Book value of own shares in trading portfolio |
96 |
54 |
36 |
|
Net Asset Value |
57,159 |
57,158 |
56,895 |
|
Goodwill(2) |
(4,143) |
(4,004) |
(4,008) |
|
Intangible Assets |
(2,917) |
(2,958) |
(2,954) |
|
Net Tangible Asset Value |
50,099 |
50,196 |
49,933 |
|
|
|
|
|
|
Number of shares used to calculate
NAPS(3) |
787,442 |
799,161 |
796,244 |
|
Net Asset Value per Share |
72.6 |
71.5 |
71.5 |
|
Net Tangible Asset Value per Share |
63.6 |
62.8 |
62.7 |
7 - Calculation of Earnings Per Share
(EPS)
The EPS published by Societe Generale is
calculated according to the rules defined by the IAS 33 standard
(see page 44 of Societe Generale’s 2024 Universal Registration
Document). The corrections made to Group net income in order to
calculate EPS correspond to the restatements carried out for the
calculation of ROE and ROTE.
The calculation of Earnings Per Share is described in the following
table:
|
Average number of shares (thousands) |
H1 24 |
Q1 24 |
2023 |
|
Existing shares |
802,980 |
802,980 |
818,008 |
|
Deductions |
|
|
|
|
Shares allocated to cover stock option plans and free shares
awarded to staff |
4,791 |
5,277 |
6,802 |
|
Other own shares and treasury shares |
3,907 |
0 |
11,891 |
|
Number of shares used to calculate
EPS(4) |
794,282 |
797,703 |
799,315 |
|
Group net Income (in EUR m) |
1,793 |
680 |
2,493 |
|
Interest on deeply subordinated notes and undated subordinated
notes (in EUR m) |
(356) |
(166) |
(759) |
|
Adjusted Group net income (in EUR m) |
1,437 |
514 |
1,735 |
|
EPS (in EUR) |
1.81 |
0.64 |
2.17 |
22
8 - The Societe Generale Group’s Common Equity Tier 1
capital is calculated in accordance with applicable
CRR2/CRD5 rules. The fully loaded solvency ratios are presented pro
forma for current earnings, net of dividends, for the current
financial year, unless specified otherwise. When there is reference
to phased-in ratios, these do not include the earnings for the
current financial year, unless specified otherwise. The leverage
ratio is also calculated according to applicable CRR2/CRD5 rules
including the phased-in following the same rationale as solvency
ratios.
9 - Funded balance sheet, loan to
deposit ratio
The funded balance sheet is
based on the Group financial statements. It is obtained in two
steps:
- A first step aiming at reclassifying
the items of the financial statements into aggregates allowing for
a more economic reading of the balance sheet. Main
reclassifications:
Insurance: grouping of the accounting items
related to insurance within a single aggregate in both assets and
liabilities.
Customer loans: include outstanding loans with customers (net of
provisions and write-downs, including net lease financing
outstanding and transactions at fair value through profit and
loss); excludes financial assets reclassified under loans and
receivables in accordance with the conditions stipulated by IFRS 9
(these positions have been reclassified in their original
lines).
Wholesale funding: Includes interbank liabilities and debt
securities issued. Financing transactions have been allocated to
medium/long-term resources and short-term resources based on the
maturity of outstanding, more or less than one year.
Reclassification under customer deposits of the share of issues
placed by French Retail Banking networks (recorded in
medium/long-term financing), and certain transactions carried out
with counterparties equivalent to customer deposits (previously
included in short term financing).
Deduction from customer deposits and reintegration into short-term
financing of certain transactions equivalent to market
resources.
- A second step aiming at excluding
the contribution of insurance subsidiaries, and netting
derivatives, repurchase agreements, securities borrowing/lending,
accruals and “due to central banks”.
The Group loan/deposit ratio is
determined as the division of the customer loans by customer
deposits as presented in the funded balance sheet.
NB (1) The sum of values contained in the tables
and analyses may differ slightly from the total reported due to
rounding rules.
(2) All the information on the results for the period (notably:
press release, downloadable data, presentation slides and
supplement) is available on Societe Generale’s website
www.societegenerale.com in the “Investor” section.
10. APPENDIX
3 : CHANGE IN NAME OF INTERNATIONAL RETAIL
BANKING, MOBILITY AND LEASING SERVICES’ ACTIVITIES
The name of International Retail Banking,
Mobility and Leasing Services’ activities was changed as follows:
Mobility, International Retail Banking and Financial Services. This
change in name has no impact on historical financial results of the
pillar.
11. APPENDIX 4:
PUBLICATION OF NEW QUARTERLY SERIES
Societe Generale is reporting new
quarterly series mainly reflecting the impacts from the
organisation changes operated within Global Banking and Investor
Solutions’ activities.
In compliance with the strategic goal of a more
asset-light capital model, the Group set up in the second quarter
2024 a common sales platform between teams working in Financing
& Advisory and Global Markets activities to boost the
distribution of assets held on the balance sheet. This change
resulted in, on the one hand, the gathering of revenues and costs
within a single entity and, on the other, a change in their share
between Financing and Advisory and Global Markets.
Also, a few other minor adjustments have been
made on the share of revenues and costs within some activities.
2022, 2023 and Q1 24 quarterly series were
restated accordingly and are available on Societe Générale website
(the data of this press release have not been audited).
2022, 2023 and Q1 24 financial impacts on
Global Banking and Investor Solutions’ activities
2022 (In EURm)
|
|
Global Markets and Investor Services |
Financing and Advisory |
|
Global Banking and Investor Solutions |
|
|
Reported
03/05/2024 |
Reported
01/08/2024 |
Gap |
|
Reported
03/05/2024 |
Reported
01/08/2024 |
Gap |
|
Reported
03/05/2024 |
Reported
01/08/2024 |
Gap |
|
Net Banking Income |
6,721 |
6,671 |
-50 |
|
3,387 |
3,438 |
51 |
|
10,108 |
10,110 |
2 |
|
Operating expenses |
-4,878 |
-4,791 |
87 |
|
-1,954 |
-2,038 |
-84 |
|
-6,832 |
-6,830 |
2 |
|
Gross operating income |
1,843 |
1,880 |
37 |
|
1,433 |
1,400 |
-33 |
|
3,276 |
3,280 |
4 |
|
Group net income |
1,402 |
1,429 |
27 |
|
891 |
868 |
-23 |
|
2,293 |
2,297 |
4 |
2023 (In EURm)
|
|
Global Markets and Investor Services |
Financing and Advisory |
|
Global Banking and Investor Solutions |
|
|
Reported
03/05/2024 |
Reported
01/08/2024 |
Gap |
|
Reported
03/05/2024 |
Reported
01/08/2024 |
Gap |
|
Reported
03/05/2024 |
Reported
01/08/2024 |
Gap |
|
Net Banking Income |
6,299 |
6,273 |
-26 |
|
3,341 |
3,369 |
28 |
|
9,640 |
9,642 |
2 |
|
Operating expenses |
-4,755 |
-4,698 |
57 |
|
-2,032 |
-2,091 |
-59 |
|
-6,787 |
-6,788 |
-1 |
|
Gross operating income |
1,544 |
1,575 |
31 |
|
1,309 |
1,279 |
-30 |
|
2,853 |
2,854 |
1 |
|
Group net income |
1,166 |
1,191 |
25 |
|
1,114 |
1,090 |
-24 |
|
2,280 |
2,280 |
0 |
Q1 24 (In EURm)
|
|
Global Markets and Investor Services |
Financing and Advisory |
|
Global Banking and Investor Solutions |
|
|
Reported
03/05/2024 |
Reported
01/08/2024 |
Gap |
|
Reported
03/05/2024 |
Reported
01/08/2024 |
Gap |
|
Reported
03/05/2024 |
Reported
01/08/2024 |
Gap |
|
Net Banking Income |
1,764 |
1,743 |
-21 |
|
859 |
881 |
+22 |
|
2,623 |
2,623 |
0 |
|
Operating expenses |
-1,198 |
-1,185 |
+13 |
|
-559 |
-572 |
-13 |
|
-1,757 |
-1,757 |
0 |
|
Gross operating income |
566 |
558 |
-8 |
|
316 |
309 |
+9 |
|
866 |
867 |
1 |
|
Group net income |
428 |
421 |
-7 |
|
262 |
270 |
+8 |
|
690 |
691 |
1 |
Societe Generale
Societe Generale is a top tier European Bank with
more than 126,000 employees serving about 25 million clients in 65
countries across the world. We have been supporting the development
of our economies for nearly 160 years, providing our corporate,
institutional, and individual clients with a wide array of
value-added advisory and financial solutions. Our long-lasting and
trusted relationships with the clients, our cutting-edge expertise,
our unique innovation, our ESG capabilities and leading franchises
are part of our DNA and serve our most essential objective - to
deliver sustainable value creation for all our stakeholders.
The Group runs three complementary sets of businesses, embedding
ESG offerings for all its clients:
- French Retail,
Private Banking and Insurance, with leading retail bank SG
and insurance franchise, premium private banking services, and the
leading digital bank BoursoBank.
- Global Banking
and Investor Solutions, a top tier wholesale bank offering
tailored-made solutions with distinctive global leadership in
equity derivatives, structured finance and ESG.
- Mobility,
International Retail Banking and Financial Services,
comprising well-established universal banks (in Czech Republic,
Romania and several African countries), Ayvens (the new ALD I
LeasePlan brand), a global player in sustainable mobility, as well
as specialized financing activities.
Committed to building together with its clients a
better and sustainable future, Societe Generale aims to be a
leading partner in the environmental transition and sustainability
overall. The Group is included in the principal socially
responsible investment indices: DJSI (Europe), FTSE4Good (Global
and Europe), Bloomberg Gender-Equality Index, Refinitiv Diversity
and Inclusion Index, Euronext Vigeo (Europe and Eurozone), STOXX
Global ESG Leaders indexes, and the MSCI Low Carbon Leaders Index
(World and Europe).
For more information, you can follow us on
Twitter/X @societegenerale or visit our website
societegenerale.com.
Asterisks * in this document refers to data at
constant perimeter and exchange rates
1 Reported Cost/Income ratio of 70.6% in Q2 23, 74.9% in Q1 24 and
73.3% in H1 23
2 Including IFRS 9 phasing, proforma including Q2 24 results
3 Based on a pay-out ratio of 50% of the Group net income, at the
high-end of the 40%-50% pay-out ratio, as per regulation, restated
from non-cash items and after deduction of interest on deeply
subordinated notes and undated subordinated notes
4 Excluding the impact of previous reduction in depreciation costs
and Purchase Price Allocation
5 Ratio calculated according to European Banking Authority (EBA)
methodology published on 16 July 2019
6 Ratio excluding loans outstanding of companies currently being
disposed of in compliance with IFRS 5 (in particular Société
Générale Equipment Finance, SG Marocaine de Banques and La
Marocaine Vie)
7 Ratio of S3 provisions, guarantees and collaterals over gross
outstanding non-performing loans
8 EUR 1bn Group’s energy transition investment, announced at the
Capital Markets Day in September 2023, with 3 components: emerging
leaders for the energy transition, nature-based solutions and
impact-driven opportunities contributing to the UN SDGs
9 Including IFRS 9 phasing, proforma including Q2 24 results
10 Combined Buffer Requirement (CBR) of 4.33% at end-Q2 24
11 Including revenues from Insurance
activities
12 Including Moroccan outstandings
13 -3.9% vs. Q2 23 restated both from non-recurring items (notably
reduction in depreciation costs at EUR 7m in Q2 24 vs. EUR 158m in
Q2 23 and hyperinflation in Turkey at EUR -37m in Q2 24 vs. EUR 1m
in Q2 23) and perimeter effect including Purchase Price Allocation
(base effect of ~EUR 130m as the first contribution of LeasePlan
happened on May 22 2023)
14 Excluding non-recurring items (driven by hyperinflation in
Turkey at EUR -37m in Q2 24 vs. EUR -2m in Q1 24)
15 Annualised and as a percentage of average earning assets
16 Excluding the impact of previous reduction in depreciation costs
and Purchase Price Allocation
17 Interest net of tax
18 The dividend to be paid is calculated based on a pay-out ratio
of 50%, restated from non-cash items and after deduction of
interest on deeply subordinated notes and on undated subordinated
notes
19 Excluding goodwill arising from non-controlling interests
20 Interest net of tax
21 Excluding goodwill arising from non-controlling interests
22 The number of shares considered is the average number of
ordinary shares outstanding during the period, excluding treasury
shares and buybacks, but including the trading shares held by the
Group.
4 The number of shares considered is the number of
ordinary shares outstanding at end of period, excluding treasury
shares and buybacks, but including the trading shares held by the
Group
-
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