LONDON – Société Générale reported a 7.8 percent rise in second-quarter earnings on Friday as France's second largest bank behind BNP Paribas benefited from a decline in exposure to risky loans.
The bank said that its net income for the three months through June 30 reached 1.03 billion euros, or $1.37 billion, compared with €955 million in the same period last year.
Earlier this year, Société Générale laid out plans to achieve a 3 percent annual growth between 2014 and 2016, and a return of equity, a measure of the bank's profitability, of more than 10 percent over the next three years.
On Friday, the French bank said that its return on equity rose to 8.8 percent in the second quarter, and that it had booked a 24 percent decline, to €752 million, in financial provisions to cover exposure to potential risky loans.
Société Générale said it had also benefited from the recent acquisition of the remaining 50 percent stake that it did not already own in Newedge Group, a derivatives brokerage.
"We confirmed the group's growth potential and our ability to improve our profitability," Société Générale's chief executive, Frédéric Oudéa, said in a statement.
Despite the bank's improving profitability, it still faces a number of potential risks.
That includes exposure to Russia, where Société Générale recently increased its stake in the large local financial institution Rosbank. The French bank originally had bought an 82 percent stake in Rosbank in 2006, and increased its holding to almost 100 in April.
The bank's net income from its retail banking operations in that country fell 36 percent, to €16 million in the quarter.
Société Générale also said that it had made a further €200 million provision for unspecified future litigation costs. The bank now has set aside a combined €900 million for potential legal issues.
The French financial giant is under investigation over whether it broke sanctions by providing banking services to countries blacklisted by the United States. Its local rival, BNP Paribas, already has agreed to a record $8.9 billion fine in relation to the ongoing investigation.
And last year, Société Générale also agreed to pay a €370 million fine related to the alleged rigging of European benchmark interest rates, though the bank has now appealed the ruling because it thought regulators may have miscalculated the size of the penalty.
The bank said that second-quarter net income in its global banking and investor solutions unit, which includes investment and private banking, increased 28 percent, to €585 million, compared with the same period last year.
Net income from its international retail banking division also jumped 31 percent, to €318 million, while profit from its French retail banking unit rose 2 percent, to €336 million euros.
Société Générale's common Tier 1 equity, a measure of a bank's ability to weather financial shocks, now stands at 10.2 percent, which is higher than what has been demanded by international regulators.
source : http://rss.nytimes.com/c/34625/f/640316/s/3d14ab28/sc/2/l/0Ldealbook0Bnytimes0N0C20A140C0A80C0A10Csocit0Egnrale0Eprofit0Erises0Eas0Eloan0Eproblems0Erecede0C0Dpartner0Frss0Gemc0Frss/story01.htm
Tidak ada komentar:
Posting Komentar