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LONDON – French bank Societe Generale has announced a “record” quarter for its trading division, helping it to exceed analysts’ expectations for the first three months of 2021.
First-quarter net profit was 814 million euros ($ 977 million), the lender said Thursday. Analysts expected a net profit of 204 million euros.
Societe Generale benefited from a significant boost from its Global Markets division, where turnover reached 1.65 million euros and the level of activity is the highest since the first quarter of 2017.
Fixed income and foreign exchange revenues increased 51% from the previous quarter. In the equities business, turnover jumped 44%.
“The Equities activities achieved their best quarter since 2015, with a remarkable performance in each of the regions, all activities having benefited from the good market conditions,” the bank said in its press release.
Speaking to CNBC on Thursday, the bank’s chief financial officer William Kadouch-Chassaing said it was “an excellent quarter across the board.”
“We are back to normal, so I expect that we will continue on this path as the economic situation continues to evolve as it is now,” he said.
Other highlights of the quarter:
- Revenues reached 6.2 billion euros against 5.2 billion a year ago.
- Spending is almost stable compared to a year ago, at 4.7 billion euros.
- The CET 1 ratio, a measure of banks’ solvency, stood at 13.5% against 13.4% at the end of 2020.
Going forward, the bank expects the “cost of business risk” to increase slightly throughout the year. It increased its provision for bad debts by 300 million euros and reduced its provision for healthy debts by 24 million euros.
Kadouch-Chassaing also told CNBC that the bank is keeping the same amount of provisions for the rest of the year.
“What we’re seeing right now is clearly a very low level of flaws. There’s no indication that it’s going to increase. At some point it can happen, but we don’t see it yet, so it’s important to maintain cautious provisioning for now and if it happens, ”he said.
Societe Generale shares rose nearly 5% in the early hours of trading in Europe.
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