The headquarters of the French bank Societe Generale in Paris.
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Societe Generale on Wednesday reported better-than-expected earnings despite receiving 3.3 billion euros ($3.36 billion) from leaving its Russia operations.
The French lender saw every unit grow in the second quarter, which helped offset the impact of leaving Russia following Moscow’s invasion of Ukraine.
According to Refinitiv, analysts estimate a net loss of 2.85 billion euros for the quarter, however, the bank posted a net loss of 1.48 billion euros.
“We combined, in the first half of 2022, strong revenue growth and over 10% fundamental profit (ROTE) and we were able to manage the exit from our Russian operations without a hitch. capital intensive and does not affect the Group’s strategic developments,” Fréderic Oudéa, the group’s chief executive officer, said in a statement.
Speaking to CNBC, Oudéa said the decision to leave Russia was “very sad,” but a necessary one.
“When you’ve been investing successfully for many years, it’s sad but when you look at the situation, it’s very difficult to manage, too risky in the future, there’s no clear outcome of all this, so obviously Obviously it was the best decision.” he told CNBC’s Charlotte Reed.
Other highlights for the quarter:
- Revenue was 7 billion euros for the quarter.
- Operating costs reached 4.5 billion euros.
- The CET 1 ratio, a measure of a bank’s solvency, was at 12.9% at the end of June.
The French retail bank posted 18.7% higher net profit compared to the previous quarter. International retail banking is also up 33% from the previous three months. Global Banking also posted a nearly 50% increase in net income from the previous quarter.
Going forward, the French bank said it aims to achieve a return on tangible equity, a measure of profitability, of 10% and a CET 1 ratio of 12% by 2025. also want an average annual revenue growth of 3% or more. until then.
Share prices are 28% lower than at the beginning of the year.