SocGen hikes 2013 dividend on fourth quarter profit
Societe Generale, France’s second-biggest bank, has said this morning that a strong performance by its domestic retail banking unit helped it turn €322m (£267m) profit in the fourth quarter. A year earlier, SocGen made a loss of €471m.
It confirmed that, by mid-May, it’ll present a ‘roadmap’ for achieving a 10 per cent return on equity by the end of 2015.
The bank's better-than-expected results saw it achieve a return on equity of 7.8 per cent on an adjusted basis for the quarter.
It’s also pledged to return more to shareholders this year, proposing a dividend of €1 per share, up from 45 cents in 2012.
"We have accomplished the transformation of the balance sheet at year-end 2013," said chairman and chief executive Frederic Oudea in an interview.
Group net income rose 11 per cent to €281m in the quarter, as the bank cut costs.
Over the whole year, excluding the revaluation of financial liabilities, revenues increased 5.5 per cent to €24.4bn.
The bank’s investment arm didn’t have such a good year, though, as fixed income trading affected it.
Revenues from fixed income, currencies and commodities (FICC) fell to €2.2bn in the year – dropping almost 40 per cent in the fourth quarter to €392m. The bank said:
This performance can be explained by solid client-driven activity with both Corporate clients, notably on forex and fixed income products, and institutional clients.
SocGen was slapped with a €446m fine from EU antitrust regulators over attempted fixing of a benchmark interest rate.
But, as other banks have done, SocGen offset the loss with a far stronger performance in equities, which saw revenues almost double.
Saxo Bank, which predicted a fourth quarter upside surprise, has said SocGen’s stock is undervalued.
Shares climbed almost four per cent this morning.
