Net Banking Income Rises At SocGen's Wealth, Asset Arm

Tom Burroughes

3 August 2021

Paris-listed Societe Generale today said that its asset and wealth management business logged net banking income of €232 million in the second quarter of 2021, steady on a year ago.

Within that business division, its private banking area logged net income of €171 million in Q2 2021, dropping 8.8 per cent; however, the figure actually rose 8 per cent when the figures took into account a one-off €29 million impact of an insurance payout.

“The business benefited from strong commercial activity combined with net inflow amounting to +€2.1 billion,” the French banking group said in a statement.
The private bank’s assets under management rose 4.2 per cent in the latest quarter from the end of March, standing at €126 billion, it said. There were net client inflows of €4.5 billion in the first half of 2021, with all regions of Societe Generale’s business delivering a positive result, it said.

Across the whole Societe Generale banking group, it logged underlying net income, on a reported basis, of €1.349 billion in Q2 2021, against a small net figure of €8 million a year ago. Much of the change in fortunes was down to impairment losses on goodwill swinging from a loss of €684 million a year ago to zero in Q2. Net banking income rose to €6.261 billion from €5.296 billion; operating costs rose to €4.107 billion from €3.86 billion, it said.

“Once again, Societe Generale enjoyed an excellent quarter, with a solid commercial and financial performance by all its businesses. Q2 was marked by the strong revenue momentum, continued cost discipline and a very low cost of risk resulting from very few loan defaults. The results for H1 2021 are the best for five years, illustrating the strength of the business model and the group’s capacity to rebound. On these bases, the group is raising its full-year forecasts for 2021,” Frédéric Oudéa, group chief executive, said.

At 30 June, Societe Generale’s Common Equity Tier 1 ratio stood at 13.4 per cent, or around 430 basis points above the regulatory requirement for this measure of capital strength, it added.