RESULTS AT DECEMBER 31ST 2021
Press release
2021, RECORDGROUP NET INCOME
Substantial increase in underlying revenues of+16.1%(1) vs.2020 (+17.2%(1)*), with a historically high level of Financing & Advisory and Financial Services activities, very solid Global Markets activities throughout the year, and a healthy momentum in Retail Banking
Underlying gross operating income of EUR 8.5billion(1), up 51.0%(1) vs. 2020, with a significant positive jaws effect and costs under control, up +4.3%(1)
Still low cost of risk at 13 basis points
Underlying Group net income of EUR5.3billion(1)(
Underlying profitability (ROTE) of 10.2%(1) (11.7% on a reported basis)
InQ4 21, underlying gross operating income of EUR 1.9billion(1), +24.1% vs. Q4 20
Underlying profitability (ROTE) of9.2%(1) (16.6% on a reported basis)
ATTRACTIVE SHAREHOLDER DISTRIBUTION
Distribution equivalent to EUR 2.75 per share, or:
- a dividend in cash, proposed to the General Meeting, of EUR 1.65 per share
- a share buyback programme, for around
EUR 915 million , equivalent to EUR 1.1 per share
Solid CET 1 ratio of 13.7%2(2) at end-2021, around 470 basis points above the regulatory requirement
ACCELERATION IN STRATEGIC AND BUSINESS DEVELOPMENTS
Strengthening of our competitive position on mobility, announcementof the planned acquisition of
Client onboarding by
Good momentum of the retail banking networks in
Continued digitalisation initiativesandimprovement of operational efficiency in International Retail Banking
Solid performance by Global Markets throughout the year, with the successful repositioning of structured products and a reduction in the risk profile
Record performance by Financing & Advisory, driven by strong market momentum and an increase in allocated capital
Fréderic Oudéa, the Group’s Chief Executive Officer, commented:
“2021 marks a milestone for the Societe
- GROUP CONSOLIDATED RESULTS
In EURm | Q4 21 | Q4 20 | Change | 2021 | 2020 | Change | ||
Net banking income | 6,620 | 5,838 | +13.4% | +11.7%* | 25,798 | 22,113 | +16.7% | +17.7%* |
Underlying net banking income(1) | 6,503 | 5,838 | +11.4% | +9.8%* | 25,681 | 22,113 | +4.3% | +17.2%* |
Operating expenses | (4,565) | (4,351) | +4.9% | +3.6%* | (17,590) | (16,714) | +5.2% | +5.8%* |
Underlying operating expenses(1) | (4,617) | (4,318) | +6.9% | +5.6%* | (17,211) | (16,504) | +4.3% | +4.9%* |
Gross operating income | 2,055 | 1,487 | +38.2% | +35.3%* | 8,208 | 5,399 | +52.0% | +55.1%* |
Underlying gross operating income(1) | 1,886 | 1,520 | +24.1% | +21.4%* | 8,470 | 5,609 | +51.0% | +53.9%* |
Net cost of risk | (86) | (689) | -87.5% | -87.7%* | (700) | (3,306) | -78.8% | -78.6%* |
Operating income | 1,969 | 798 | x 2.5 | x 2.4 | 7,508 | 2,093 | x 3.6 | x 3.7* |
Underlying operating income(1) | 1,800 | 851 | x 2.1 | x 2.1 | 7,770 | 2,323 | x 3.3 | x 3.4* |
Net profits or losses from other assets | 449 | (94) | n/s | n/s | 635 | (12) | n/s | n/s* |
Impairment losses on goodwill | (114) | 0 | n/s | n/s | (114) | (684) | n/s | n/s |
Income tax | (311) | (125) | x 2.5 | x 2.4 | (1,697) | (1,204) | +41.0% | +43.2%* |
Net income | 1,995 | 582 | x 3.4 | x 3.3 | 6,338 | 196 | x 32.3 | x 43.8 |
O.w. non-controlling interests | 208 | 112 | +85.7% | +81.2%* | 697 | 454 | +53.5% | +53.6%* |
Reported Group net income | 1,787 | 470 | x 3.8 | x 3.7 | 5,641 | (258) | n/s | n/s |
Underlying Group net income(1) | 1,226 | 631 | +94.4% | +90.4%* | 5,264 | 1,435 | x 3.7 | x 3.8* |
ROE | 12.1% | 2.4% | 9.6% | -1.7% | ||||
ROTE | 16.6% | 2.7% | 11.7% | -0.4% | ||||
UnderlyingROTE(1) | 9.2% | 4.1% | 10.2% | 1.7% |
(1) Adjusted for exceptional items and linearisation of IFRIC 21
Societe Generale’s Board of Directors, which met on
The various restatements enabling the transition from underlying data to published data are presented in the methodology notes (section 10.5).
Net banking income
Net banking income was substantially higher in 2021, up +16.7% (+17.7%*) vs. 2020, and +16.1% (+17.2%*) vs. 2020 on an underlying basis, with a very strong momentum in all the businesses.
French Retail Banking posted a solid performance in 2021. As a result, net banking income (excluding PEL/CEL provision) increased by +4.8% vs. 2020, driven by the recovery in net interest income and buoyant commissions, particularly financial commissions.
International Retail Banking & Financial Services enjoyed strong revenue growth (+9.9%* vs. 2020), underpinned by the excellent momentum in Financial Services to Corporates (+32.0%* vs. 2020) and Insurance (+8.6%* vs. 2020). International Retail Banking benefited from a rebound in its activities (+2.8%* vs. 2020).
Global Banking & Investor Solutions delivered a remarkable performance, with revenues up +25.2% (+26.1%*) vs. 2020. Financing & Advisory enjoyed a record performance, with growth of +14.8% (+15.8%*) vs. 2020, while the revenues of Global Markets & Investor Services were substantially higher (+35.6%, +36.9%*) than in 2020.
In Q4 21, the Group continued to enjoy a strong revenue growth momentum (+13.4%, +11.7%*) vs. Q4 20, with a positive and evenly balanced contribution from all the businesses.
Operating expenses
In 2021, operating expenses totalled
This increase can be explained primarily by the rise in variable costs linked to the growth in revenues (
Driven by a very positive jaws effect, underlying gross operating income grew substantially (+51.0%) to
In Q4 21, operating expenses totalled
Excluding the contribution to the
There is expected to be an increase in the contribution to the
The Group’s radical transformations as announced in 2021 have led to changes in 2023 cost outlook. The various initiatives in progress will contribute to a decline in the Group’s underlying cost to income ratio beyond 2022 excluding the contribution to the
Cost of risk
In 2021, the cost of risk stood at a low level of 13 basis points, lower than in 2020 (64 basis points), or
The Group’s provisions on performing loans amounted to
In Q4 21, the cost of risk stood at 6 basis points, lower than in Q4 20 (54 basis points), or
In order to support its customers during the crisis, the Group granted State Guaranteed Loans. At
The gross doubtful outstandings ratio amounted to 2.9%3(1) at
The cost of risk is expected to be below 30 basis points in 2022.
Group net income
In EURm | Q4 21 | Q4 20 | 2021 | 2020 | ||||
1,787 | 470 | 5,641 | (258) | |||||
1,226 | 631 | 5,264 | 1,435 |
In EURm | Q4 21 | Q4 20 | 2021 | 2020 | ||||
16.6% | 2.7% | 11.7% | -0.4% | |||||
9.2% | 4.1% | 10.2% | 1.7% |
(1) Adjusted for exceptional items and linearisation of IFRIC21
Earnings per share amounts to
Distribution to shareholders
The Board of Directors has established its distribution policy at 50% of underlying Group net income5(2), which is equivalent to
A dividend in cash of
Furthermore, the Group plans to launch a share buyback programme for a total amount of around
- THE GROUP’S FINANCIAL STRUCTURE
Group shareholders’ equity totalled
The consolidated balance sheet totalled
At
The LCR (Liquidity Coverage Ratio) was well above regulatory requirements at 129% at
The Group’s risk-weighted assets (RWA) amounted to
At
The Group is aiming for a CET1 ratio between 200-250 basis points minimum above the regulatory requirement including after the entry into force of the regulation finalising the Basel III reform.
The leverage ratio stood at 4.9% at
With a level of 31.1% of RWA and 9.5% of leverage exposure at
The Group is rated by four rating agencies: (i) Fitch Ratings - long-term rating “A-”, stable rating, senior preferred debt rating “A”, short-term rating “F1” (ii) Moody’s - long-term rating (senior preferred debt) “A1”, stable outlook, short-term rating “P-1” (iii) R&I - long-term rating (senior preferred debt) “A”, stable outlook; and (iv)
- FRENCH RETAIL BANKING
In EURm | Q4 21 | Q4 20 | Change | 2021 | 2020 | Change |
Net banking income | 2,048 | 1,845 | +11.0% | 7,777 | 7,315 | +6.3% |
Net banking income excl. PEL/CEL | 2,027 | 1,870 | +8.4% | 7,738 | 7,381 | +4.8% |
Operating expenses | (1,534) | (1,443) | +6.3% | (5,635) | (5,418) | +4.0% |
Underlying operating expenses(1) | (1,573) | (1,476) | +6.6% | (5,635) | (5,418) | +4.0% |
Gross operating income | 514 | 402 | +27.9% | 2,142 | 1,897 | +12.9% |
Underlying gross operating income(1) | 454 | 394 | +15.3% | 2,103 | 1,963 | +7.1% |
Net cost of risk | 20 | (276) | n/s | (104) | (1,097) | -90.5% |
Operating income | 534 | 126 | x 4.2 | 2,038 | 800 | x 2.5 |
Net profits or losses from other assets | 22 | 19 | +15.8% | 24 | 158 | -84.8% |
Reported Group net income | 400 | 104 | x 3.8 | 1,492 | 666 | x 2.2 |
Underlying Group net income(1) | 356 | 99 | x 3.6 | 1,463 | 712 | x 2.1 |
RONE | 14.6% | 3.7% | 13.4% | 5.8% | ||
UnderlyingRONE(1) | 13.0% | 3.5% | 13.1% | 6.2% |
(1) Adjusted for the linearisation of IFRIC 21 and PEL/CEL provision
Societe Generale and Crédit du Nord networks
Average loan outstandings were -1% lower than in Q4 20 at
Average outstanding balance sheet deposits increased by +7% vs. Q4 20 to
As a result, the average loan/deposit ratio stood at 87% in Q4 21 vs. 94% in Q4 20.
Insurance assets under management totalled
Private Banking’s assets under management totalled
Property/casualty insurance premiums were up +5% vs. Q4 20, while personal protection insurance premiums were up +4% vs. Q4 20. The penetration rate for our customer base has improved both for property/casualty insurance and personal protection insurance.
The bank consolidated its position as the leading online bank in
This quarter,
Average outstanding loans rose +28% vs. Q4 20 to
Average outstanding savings including deposits and financial savings were 25% higher than in Q4 20 at
Q4 20. Brokerage volumes were stable in 2021 compared to 2020 at a record level (x3 compared to 2019).
Net banking income excluding PEL/CEL
2021: revenues (excluding PEL/CEL) totalled
Q4 21: revenues (excluding PEL/CEL) totalled
Operating expenses
2021: operating expenses totalled
Q4 21: operating expenses amounted to
Cost of risk
2021: the cost of risk amounted to
Q4 21: the cost of risk represented a write-back of
Contribution to Group net income
2021: the contribution to Group net income was
Q4 21: the contribution to Group net income was
- INTERNATIONAL RETAIL BANKING & FINANCIAL SERVICES
In EURm | Q4 21 | Q4 20 | Change | 2021 | 2020 | Change | ||
Net banking income | 2,159 | 1,919 | +12.5% | +10.3%* | 8,117 | 7,524 | +7.9% | +9.9%* |
Operating expenses | (1,088) | (1,018) | +6.9% | +4.2%* | (4,203) | (4,142) | +1.5% | +3.1%* |
Underlying operating expenses(1) | (1,112) | (1,042) | +6.7% | +4.1%* | (4,203) | (4,142) | +1.5% | +3.1%* |
Gross operating income | 1,071 | 901 | +18.9% | +17.3%* | 3,914 | 3,382 | +15.7% | +18.3%* |
Underlying gross operating income(1) | 1,047 | 877 | +19.4% | +17.8%* | 3,914 | 3,382 | +15.7% | +18.3%* |
Net cost of risk | (96) | (287) | -66.6% | -67.2%* | (504) | (1,265) | -60.2% | -59.4%* |
Operating income | 975 | 614 | +58.8% | +57.5%* | 3,410 | 2,117 | +61.1% | +65.2%* |
Net profits or losses from other assets | 8 | 6 | +33.3% | +36.6%* | 18 | 15 | +20.0% | +21.2%* |
Reported Group net income | 584 | 376 | +55.3% | +54.9%* | 2,082 | 1,304 | +59.7% | +64.4%* |
Underlying Group net income(1) | 570 | 362 | +57.5% | +57.1%* | 2,082 | 1,304 | +59.7% | +64.4%* |
RONE | 22.2% | 14.9% | 20.3% | 12.4% | ||||
UnderlyingRONE(1) | 21.7% | 14.3% | 20.3% | 12.4% |
(1) Adjusted for the linearisation of IFRIC 21
International Retail Banking’s loan and deposit production provided confirmation in Q4 of its rebound in all geographical regions. Outstanding loans totalled
For the
In
In
In the Insurance business, the life insurance savings business saw outstandings increase +7%* at
Financial Services to Corporates also enjoyed a healthy momentum.
2020, while outstanding loans rose +1.1% vs.
Net banking income
Net banking income amounted to
International Retail Banking’s net banking income totalled
Thanks to a rise in interest rates, a healthy commercial momentum and an increase in commissions (+16%* vs. Q4 20), revenues in
In 2021, the revenues of SG Russia7(1) were down -2.8%* (-7.0%* vs. Q4 20), adversely affected firstly, by a temporary squeeze on individual customer margins (part of the rise in rates not being passed on to individual customers) and secondly, by a non-recurring item affecting the recognition of commissions.
The
The Insurance business posted net banking income up +8.6%* vs. 2020, at
Financial Services to Corporates’ net banking income was substantially higher (+32.0%*) than in 2020, at
Operating expenses
Operating expenses totalled
In International Retail Banking, operating expenses were slightly higher (+2.5%*) than in 2020. Operating expenses were 4.0%* higher than in Q4 20.
In the Insurance business, operating expenses were in line with the expansion ambitions and rose +4.8%* vs. 2020 and +6.6%* vs. Q4 20.
In Financial Services to Corporates, operating expenses increased by +4.4%* vs. 2020 and +4.7%* vs. Q4 20.
Cost of risk
Q4 21: the cost of risk amounted to 28 basis points (
2021: the cost of risk amounted to 38 basis points (
Contribution to Group net income
The contribution to Group net income totalled
Underlying RONE stood at 20.3% in 2021 (vs. 12.4% in 2020) and 21.7% in Q4 21 (14.3% in Q4 20), with RONE of 16% in International Retail Banking and 26% in Financial Services.
- GLOBAL BANKING & INVESTOR SOLUTIONS
In EURm | Q4 21 | Q4 20 | Variation | 2021 | 2020 | Variation | ||
Net banking income | 2,320 | 2,072 | +12.0% | +9.7%* | 9,530 | 7,613 | +25.2% | +26.1%* |
Operating expenses | (1,556) | (1,688) | -7.8% | -9.3%* | (6,863) | (6,713) | +2.2% | +2.7%* |
Underlying operating expenses(1) | (1,681) | (1,638) | +2.6% | +0.9%* | (6,863) | (6,556) | +4.7% | +5.1%* |
Gross operating income | 764 | 384 | +99.0% | +91.5%* | 2,667 | 900 | x 3.0 | x 3.0* |
Underlying gross operating income(1) | 639 | 434 | +47.3% | +42.4%* | 2,667 | 1,057 | x 2.5 | x 2.6 |
Net cost of risk | (3) | (104) | -97.1% | -97.2%* | (86) | (922) | -90.7% | -90.5%* |
Operating income | 761 | 280 | x 2.7 | x 2.6 | 2,581 | (22) | n/s | n/s |
Reported Group net income | 635 | 280 | x 2.3 | x 2.2 | 2,076 | 57 | x 36.4 | x 40.8 |
Underlying Group net income(1) | 539 | 320 | +68.4% | +64.1%* | 2,076 | 183 | x 11.4 | x 11.8 |
RONE | 16.3% | 7.8% | 13.9% | 0.4% | ||||
UnderlyingRONE(1) | 13.8% | 9.0% | 13.9% | 1.3% |
(1) Adjusted for the linearisation of IFRIC 21
Net banking income
In 2021, Global Banking & Investor Solutions posted substantially higher revenues (+25.2%) than in 2020 at
In Q4 21, revenues rose +12.0% vs. Q4 20, to
In Global Markets & Investor Services, net banking income totalled
Global Markets turned in a very strong performance in 2021 (EUR 5,001 million), with an increase of +40.2% compared to 2020 which was heavily impacted by the health crisis. Market conditions were favourable in the Equity market and more complex in the fixed income markets in 2021. The reduction in the risk profile of structured products was completed in the first half of the year, ahead
of schedule.
Q4 21 also delivered a solid performance (
The Equity activity enjoyed its best year since 2009 (EUR 3,150 million vs.
In Q4 21, the business was able to take advantage of still favourable market conditions on all products, and posted revenues of
Fixed Income & Currency activities posted revenues of
of the year.
Q4 21 delivered a resilient performance (-9.2% vs. Q4 20) in a more complex market, with higher revenues in emerging markets and financing.
There was a significant increase in Securities Services’ revenues in 2021, with revenues up +8.4% vs. 2020, at
Securities Services’ assets under custody and assets under administration amounted to
Financing & Advisory delivered the best historical annual performance, with revenues of
In Q4 21, the business again enjoyed record revenues of
Investment Banking enjoyed an excellent quarter, driven by the strong momentum of M&A, Leveraged Buyout and equity capital market activities. Revenues from
Global Transaction and Payment Services continued to experience strong growth, up +25.2% vs.
Q4 20.
Asset and Wealth Management’s net banking income totalled
In 2021, Private Banking posted an increase in revenues of +3.1% vs. 2020, to
In Q4 21, net banking income amounted to
In 2021, Lyxor’s net banking income totalled
In Q4 21, revenues were 10.9% higher than in Q4 20.
Operating expenses
2021: operating expenses totalled
Q4 21: operating expenses were up +2.6% on an underlying basis (at
Net cost of risk
2021: the cost of risk was at a low level of 5 basis points (or
Q4 21: it amounted to 1 basis point (or
Contribution to Group net income
2021: the contribution to Group net income was
Q4 21: it was
Global Banking & Investor Solutions posted a significant RONE of 13.9% in 2021 (16.1% when restated for the impact of the contribution to the
The underlying RONE was 13.8% in Q4 21.
- CORPORATE CENTRE
In EURm | Q4 21 | Q4 20 | 2021 | 2020 |
Net banking income | 93 | 2 | 374 | (339) |
Underlying net banking income(1) | (24) | 2 | 257 | (339) |
Operating expenses | (387) | (202) | (889) | (441) |
Underlying operating expenses(1) | (251) | (162) | (510) | (388) |
Gross operating income | (294) | (200) | (515) | (780) |
Underlying gross operating income(1) | (275) | (160) | (253) | (727) |
Net cost of risk | (7) | (22) | (6) | (22) |
Net profits or losses from other assets | 429 | (105) | 603 | (185) |
Impairment losses on goodwill | (114) | - | (114) | (684) |
Income tax | 193 | 52 | 187 | (482) |
Reported Group net income | 168 | (290) | (9) | (2,285) |
Underlying Group net income(1) | (255) | (133) | (386) | (718) |
(1) Adjusted for the linearisation of IFRIC 21
The Corporate Centre includes the property management of the Group’s head office, the Group’s equity portfolio, the
The Corporate Centre’s net banking income totalled
Operating expenses totalled
Operating expenses totalled
Gross operating income totalled EUR -515 million in 2021 vs.
Net profits or losses from other assets amounted to
In Q4 21, the Group benefited from the recognition of
The Corporate Centre’s contribution to Group net income was
7. CONCLUSION
In 2021, the Group delivered the best annual performance in its history, with Group net income of
2021 was also marked by major progress in the execution of all our strategic initiatives and in the strategic reallocation of our capital in favour of businesses offering profitable growth. The Group therefore announced the planned acquisition of
At
The Board of Directors has established an attractive distribution of 2021 financial results to shareholders equivalent to
Furthermore, the Group foresee a buyback programme for around
In future, the Group intends to maintain a distribution policy of 50% of underlying Group net income9(2) with up to 20% of the distribution in the form of a share buyback.
8. 2022 FINANCIAL CALENDAR
2022 Financial communication calendar |
The Alternative Performance Measures, notably the notions of net banking income for the pillars, operating expenses, IFRIC 21 adjustment, cost of risk in basis points, ROE, ROTE, RONE, net assets, tangible net assets, and the amounts serving as a basis for the different restatements carried out (in particular the transition from published data to underlying data) are presented in the methodology notes, as are the principles for the presentation of prudential ratios. This document contains forward-looking statements relating to the targets and strategies of the These forward-looking statements are based on a series of assumptions, both general and specific, in particular the application of accounting principles and methods in accordance with IFRS (International Financial Reporting Standards) as adopted in the These forward-looking statements have also been developed from scenarios based on a number of economic assumptions in the context of a given competitive and regulatory environment. The Group may be unable to: - anticipate all the risks, uncertainties or other factors likely to affect its business and to appraise their potential consequences, - evaluate the extent to which the occurrence of a risk or a combination of risks could cause actual results to differ materially from those provided in this document and the related presentation. Therefore, although More detailed information on the potential risks that could affect Societe Generale’s financial results can be found in the section “Risk Factors” in our Universal Registration Document filed with the French Autorité des Marchés Financiers (which is available on https://investors.societegenerale.com/en). Investors are advised to take into account factors of uncertainty and risk likely to impact the operations of the Group when considering the information contained in such forward-looking statements. Other than as required by applicable law, |
9. APPENDIX 1: FINANCIAL DATA
GROUP NET INCOME BY CORE BUSINESS
In EURm | Q4 21 | Q4 20 | Variation | 2021 | 2020 | Variation |
French Retail Banking | 400 | 104 | x 3.8 | 1,492 | 666 | x 2.2 |
International Retail Banking and Financial Services | 584 | 376 | +55.3% | 2,082 | 1,304 | +59.7% |
Global Banking and Investor Solutions | 635 | 280 | x 2.3 | 2,076 | 57 | x 36.4 |
Core Businesses | 1,619 | 760 | x 2.1 | 5,650 | 2,027 | x 2.8 |
Corporate Centre | 168 | (290) | n/s | (9) | (2,285) | +99.6% |
Group | 1,787 | 470 | x 3.8 | 5,641 | (258) | n/s |
CONSOLIDATED BALANCE SHEET
In EUR m | |||
Cash, due from central banks | 179,969 | 168,179 | |
Financial assets at fair value through profit or loss * | 342,714 | 411,916 | |
Hedging derivatives | 13,239 | 20,667 | |
Financial assets at fair value through other comprehensive income | 43,450 | 52,060 | |
Securities at amortised cost | 19,371 | 15,635 | |
Due from banks at amortised cost | 55,972 | 53,380 | |
Customer loans at amortised cost | 497,164 | 448,761 | |
Revaluation differences on portfolios hedged against interest rate risk | 131 | 378 | |
Investments of insurance companies | 178,898 | 166,854 | |
Tax assets * | 4,812 | 4,995 | |
Other assets | 92,898 | 67,341 | |
Non-current assets held for sale | 27 | 6 | |
Investments accounted for using the equity method | 95 | 100 | |
Tangible and intangible fixed assets | 31,968 | 30,088 | |
3,741 | 4,044 | ||
Total * | 1,464,449 | 1,444,404 |
In EUR m | |||
Due to central banks | 5,152 | 1,489 | |
Financial liabilities at fair value through profit or loss * | 307,563 | 372,705 | |
Hedging derivatives | 10,425 | 12,461 | |
Debt securities issued | 135,324 | 138,957 | |
Due to banks | 139,177 | 135,571 | |
Customer deposits | 509,133 | 456,059 | |
Revaluation differences on portfolios hedged against interest rate risk | 2,832 | 7,696 | |
Tax liabilities * | 1,577 | 1,227 | |
Other liabilities | 106,305 | 84,937 | |
Non-current liabilities held for sale | 1 | - | |
Insurance contracts related liabilities | 155,288 | 146,126 | |
Provisions * | 4,850 | 4,732 | |
Subordinated debts | 15,959 | 15,432 | |
Total liabilities * | 1,393,586 | 1,377,392 | |
Shareholder's equity | |||
Shareholders' equity, Group share | |||
Issued common stocks and capital reserves | 21,913 | 22,333 | |
Other equity instruments | 7,534 | 9,295 | |
Retained earnings * | 30,631 | 32,102 | |
Net income | 5,641 | (258) | |
Sub-total * | 65,719 | 63,472 | |
Unrealised or deferred capital gains and losses | (652) | (1,762) | |
Sub-total equity, Group share * | 65,067 | 61,710 | |
Non-controlling interests * | 5,796 | 5,302 | |
Total equity * | 70,863 | 67,012 | |
Total * | 1,464,449 | 1,444,404 |
(*) Amounts restated compared with the financial statements published in 2020 (See Note1.7 of financial statements)
10. APPENDIX 2: METHODOLOGY
1 –The financial information presented in respect of Q4 and 2021 was examined by the Board of Directors on
2 - Net banking income
The pillars’ net banking income is defined on page 41 of Societe Generale’s 2021 Universal Registration Document. The terms “Revenues” or “Net Banking Income” are used interchangeably. They provide a normalised measure of each pillar’s net banking income taking into account the normative capital mobilised for its activity.
3 - Operating expenses
Operating expenses correspond to the “Operating Expenses” as presented in note 8.1 to the Group’s consolidated financial statements as at
4 - IFRIC 21 adjustment
The IFRIC 21 adjustment corrects the result of the charges recognised in the accounts in their entirety when they are due (generating event) so as to recognise only the portion relating to the current quarter, i.e. a quarter of the total. It consists in smoothing the charge recognised accordingly over the financial year in order to provide a more economic idea of the costs actually attributable to the activity over the period analysed.
The contributions to
5 – Exceptional items – Transition from accounting data to underlying data
It may be necessary for the Group to present underlying indicators in order to facilitate the understanding of its actual performance. The transition from published data to underlying data is obtained by restating published data for exceptional items and the IFRIC 21 adjustment.
Moreover, the Group restates the revenues and earnings of the French Retail Banking pillar for PEL/CEL provision allocations or write-backs. This adjustment makes it easier to identify the revenues and earnings relating to the pillar’s activity, by excluding the volatile component related to commitments specific to regulated savings.
The reconciliation enabling the transition from published accounting data to underlying data is set out in the table below:
Q4 21 (in EURm) | Net Banking Income | Operating Expenses | Cost of risk | Net profit or losses from other assets | Impairment losses on goodwill | Income tax | Group net income | Business |
Reported | 6 620 | (4 565) | (86) | 449 | (114) | (311) | 1 787 | |
(+) Revaluation gain* | (117) | 2 | (115) | Corporate Center | ||||
(+) IFRIC 21 linearisation | (199) | 46 | (149) | |||||
(+) Transformation charges* | 147 | (39) | 108 | Corporate Center(1) | ||||
(+) Lyxor disposal* | (439) | 50 | (389) | Corporate Center | ||||
(+) DTA recognition* | (130) | (130) | Corporate Center | |||||
(+) | 114 | 114 | Corporate Center | |||||
Underlying | 6 503 | (4 617) | (86) | 10 | 0 | (382) | 1 226 | |
Q4 20 (in EURm) | Net Banking Income | Operating Expenses | Cost of risk | Net profit or losses from other assets | Impairment losses on goodwill | Income tax | Group net income | Business |
Reported | 5 838 | (4 351) | (689) | (94) | 0 | (125) | 470 | |
(+) IFRIC 21 linearisation | (177) | 52 | (121) | |||||
(+) Transformation charges* | 210 | (63) | 147 | o/w GBIS ( | ||||
(+) Group refocusing plan* | 20 | 101 | 14 | 135 | Corporate Center | |||
Underlying | 5 838 | (4 318) | (669) | 7 | 0 | (123) | 631 | |
2021 (in EURm) | Net Banking Income | Operating Expenses | Cost of risk | Net profit or losses from other assets | Impairment losses on goodwill | Income tax | Group net income | Business |
Reported | 25 798 | (17 590) | (700) | 635 | (114) | (1 697) | 5 641 | |
(+) Lyxor disposal* | (439) | 50 | (389) | Corporate Center | ||||
(+) Transformation charges* | 379 | (104) | 275 | Corporate Center(2) | ||||
(+) Capital gains on Haussmann office disposal* | (185) | 53 | (132) | Corporate Center | ||||
(+) Revaluation gain* | (117) | 2 | (115) | Corporate Center | ||||
(+) DTA recognition* | (130) | (130) | Corporate Center | |||||
(+) | 114 | 114 | Corporate Center | |||||
Underlying | 25 681 | (17 211) | (700) | 11 | 0 | (1 826) | 5 264 | |
2020 (in EURm) | Net Banking Income | Operating Expenses | Cost of risk | Net profit or losses from other assets | Impairment losses on goodwill | Income tax | Group net income | Business |
Reported | 22 113 | (16 714) | (3 306) | (12) | (684) | (1 204) | (258) | |
(+) Transformation charges* | 210 | (63) | 147 | o/w GBIS ( | ||||
(+) Group refocusing plan* | 20 | 178 | 14 | 212 | Corporate center | |||
(+) | 684 | 684 | Corporate center | |||||
(+) DTA impairment * | 650 | 650 | Corporate center | |||||
Underlying | 22 113 | (16 504) | (3 286) | 166 | 0 | (603) | 1 435 |
(*) Exceptional item
(1) Transformation and/or restructuring charges in Q4 21 related to RBDF (
(2) Transformation and/or restructuring charges in 2021 related to RBDF (
6 - Cost of risk in basis points, coverage ratio for doubtful outstandings
The cost of risk is defined on pages 43 and 635 of Societe Generale’s 2021 Universal Registration Document. This indicator makes it possible to assess the level of risk of each of the pillars as a percentage of balance sheet loan commitments, including operating leases.
In EURm | Q4 21 | Q4 20 | 2021 | 2020 | |
French Retail Banking | Net Cost Of Risk | (20) | 276 | 104 | 1,097 |
Gross loan Outstandings | 219,522 | 222,926 | 218,043 | 212,185 | |
Cost of Risk in bp | (4) | 50 | 5 | 52 | |
International Retail Banking and Financial Services | Net Cost Of Risk | 96 | 287 | 504 | 1,265 |
Gross loan Outstandings | 137,018 | 128,965 | 133,321 | 132,082 | |
Cost of Risk in bp | 28 | 89 | 38 | 96 | |
Global Banking and Investor Solutions | Net Cost Of Risk | 3 | 104 | 86 | 922 |
Gross loan Outstandings | 178,116 | 147,508 | 165,603 | 160,918 | |
Cost of Risk in bp | 1 | 28 | 5 | 57 | |
Corporate Centre | Net Cost Of Risk | 7 | 22 | 6 | 22 |
Gross loan Outstandings | 14,574 | 14,044 | 13,835 | 11,611 | |
Cost of Risk in bp | 16 | 62 | 4 | 20 | |
Societe | Net Cost Of Risk | 86 | 689 | 700 | 3,306 |
Gross loan Outstandings | 549,229 | 513,443 | 530,801 | 516,797 | |
Cost of Risk in bp | 6 | 54 | 13 | 64 |
The gross coverage ratio for doubtful outstandings is calculated as the ratio of provisions recognised in respect of the credit risk to gross outstandings identified as in default within the meaning of the regulations, without taking account of any guarantees provided. This coverage ratio measures the maximum residual risk associated with outstandings in default (“doubtful”).
7 - ROE, ROTE, RONE
The notions of ROE (Return on Equity) and ROTE (Return on Tangible Equity), as well as their calculation methodology, are specified on page 43 and 44 of Societe Generale’s 2021 Universal Registration Document. This measure makes it possible to assess Societe Generale’s return on equity and return on tangible equity.
RONE (Return on Normative Equity) determines the return on average normative equity allocated to the Group’s businesses, according to the principles presented on page 44 of Societe Generale’s 2021 Universal Registration Document.
Group net income used for the ratio numerator is book Group net income adjusted for “interest net of tax payable on deeply subordinated notes and undated subordinated notes, interest paid to holders of deeply subordinated notes and undated subordinated notes, issue premium amortisations” and “unrealised gains/losses booked under shareholders’ equity, excluding conversion reserves” (see methodology note No. 9). For ROTE, income is also restated for goodwill impairment.
Details of the corrections made to book equity in order to calculate ROE and ROTE for the period are given in the table below:
ROTE calculation: calculation methodology
End of period | Q4 21 | Q4 20 | 2021 | 2020 |
Shareholders' equity Group share* | 65,067 | 61,710 | 65,067 | 61,710 |
Deeply subordinated notes | (8,003) | (8,830) | (8,003) | (8,830) |
Undated subordinated notes | (264) | (264) | ||
Interest net of tax payable to holders of deeply subordinated notes & undated subordinated notes, interest paid to holders of deeply subordinated notes & undated subordinated notes, issue premium amortisations | 20 | 19 | 20 | 19 |
OCI excluding conversion reserves | (489) | (942) | (489) | (942) |
Dividend provision | (2,286) | (467) | (2,286) | (467) |
ROE equity end-of-period* | 54,310 | 51,227 | 54,310 | 51,227 |
Average ROE equity* | 53,878 | 51,307 | 52,634 | 52,091 |
Average | (3,776) | (3,928) | (3,890) | (4,172) |
Average Intangible Assets | (2,687) | (2,477) | (2,584) | (2,432) |
Average ROTE equity* | 47,415 | 44,902 | 46,160 | 45,487 |
Group net Income (a) | 1,787 | 470 | 5,641 | (258) |
1,226 | 631 | 5,264 | 1,435 | |
Interest on deeply subordinated notes and undated subordinated notes (c) | (151) | (164) | (590) | (611) |
Cancellation of goodwill impairment (d) | 337 | - | 337 | 684 |
Ajusted Group net Income (e) = (a)+ (c)+(d) | 1,973 | 306 | 5,388 | (185) |
Ajusted | 1,075 | 467 | 4,674 | 824 |
Average ROTE equity (g)* | 47,415 | 44,902 | 46,160 | 45,487 |
ROTE [quarter: (4*e/g), 12M: (2*e/g)] | 16.6% | 2.7% | 11.7% | -0.4% |
Average ROTE equity (underlying) (h)* | 46,854 | 45,063 | 45,783 | 47,180 |
Underlying ROTE [quarter: (4*f/h), 12M: (2*f/h)] | 9.2% | 4.1% | 10.2% | 1.7% |
(*) Amounts restated compared with the financial statements published in 2020 (See Note1.7 of the financial statements)
RONE calculation: Average capital allocated to Core Businesses (in EURm)
In EUR m | Q4 21 | Q4 20 | Change | 2021 | 2020 | Change |
French Retail Banking | 10,990 | 11,186 | -1.8% | 11,149 | 11,427 | -2.4% |
International Retail Banking and Financial Services | 10,523 | 10,112 | +4.1% | 10,246 | 10,499 | -2.4% |
Global Banking and Investor Solutions | 15,602 | 14,287 | +9.2% | 14,916 | 14,302 | +4.3% |
Core Businesses | 37,115 | 35,585 | +4.3% | 36,310 | 36,228 | +0.2% |
Corporate Center | 16,763 | 15,722 | +6.7% | 16,324 | 15,863 | +2.9% |
Group | 53,878 | 51,307 | +5.0% | 52,634 | 52,091 | +1.0% |
(*) Amounts restated compared with the financial statements published in 2020 (See Note1.7 of the financial statements)
8 - Net assets and tangible net assets
Net assets and tangible net assets are defined in the methodology, page 46 of the Group’s 2021 Universal Registration Document. The items used to calculate them are presented below:
End of period – in EUR m | 2021 | 2020 | 2019 |
Shareholders' equity Group share* | 65,067 | 61,710 | 63,527 |
Deeply subordinated notes | (8,003) | (8,830) | (9,501) |
Undated subordinated notes | (264) | (283) | |
Interest, net of tax, payable to holders of deeply subordinated notes & undated subordinated notes, interest paid to holders of deeply subordinated notes & undated subordinated notes, issue premium amortisations | 20 | 19 | 4 |
Bookvalue of own shares in trading portfolio | 37 | 301 | 375 |
Net Asset Value* | 57,121 | 52,936 | 54,122 |
(3,624) | (3,928) | (4,510) | |
Intangible Assets | (2,733) | (2,484) | (2,362) |
Net Tangible Asset Value* | 50,764 | 46,524 | 47,250 |
Number of shares used to calculate NAPS** | 831,162 | 848,859 | 849,665 |
Net Asset Value per Share | 68.7 | 62.4 | 63.7 |
Net Tangible Asset Value per Share | 61.1 | 54.8 | 55.6 |
(*) Amounts restated compared with the financial statements published in 2020 (See Note1.7 of the financial statements)
(* *) The number of shares considered is the number of ordinary shares outstanding as at end of period, excluding treasury shares and buybacks, but including the trading shares held by the Group.
In accordance with IAS 33, historical data per share prior to the date of detachment of a preferential subscription right are restated by the adjustment coefficient for the transaction.
9 - Calculation of Earnings Per Share (EPS)
The EPS published by
The calculation of Earnings Per Share is described in the following table:
Average number of shares (thousands) – in EUR m | 2021 | 2020 | 2019 |
Existing shares | 853,371 | 853,371 | 834,062 |
Deductions | |||
Shares allocated to cover stock option plans and free shares awarded to staff | 3,861 | 2,987 | 4,011 |
Other own shares and treasury shares | 3,249 | 149 | |
Number of shares used to calculate EPS** | 846,261 | 850,385 | 829,902 |
Group net Income | 5,641 | (258) | 3,248 |
Interest on deeply subordinated notes and undated subordinated notes | (590) | (611) | (715) |
Capital gain net of tax on partial buybacks | |||
Adjusted Group net income | 5,051 | (869) | 2,533 |
EPS (in EUR) | 5.97 | (1.02) | 3.05 |
Underlying EPS* (in EUR) | 5.52 | 0.97 | 4.03 |
(*) Calculated on the basis of underlying Group net income.
(**) The number of shares considered is the average number of ordinary shares outstanding during the period, excluding treasury shares and buybacks, but including the trading shares held by the Group.
10 – The Societe Generale Group’s Common Equity Tier 1 capital is calculated in accordance with applicable CRR2/CRD5 rules. The fully loaded solvency ratios are presented pro forma for current earnings, net of dividends, for the current financial year, unless specified otherwise. When there is reference to phased-in ratios, these do not include the earnings for the current financial year, unless specified otherwise. The leverage ratio is also calculated according to applicable CRR2/CRD5 rules including the phased-in following the same rationale as solvency ratios.
NB (1) The sum of values contained in the tables and analyses may differ slightly from the total reported due to rounding rules.
(2) All the information on the results for the period (notably: press release, downloadable data, presentation slides and supplement) is available on Societe Generale’s website www.societegenerale.com in the “Investor” section.
Active in the real economy for over 150 years, with a solid position in
- French Retail Banking which encompasses the
Societe Generale , Credit du Nord and Boursorama brands. Each offers a full range of financial services with omnichannel products at the cutting edge of digital innovation;
- International Retail Banking, Insurance and Financial Services to Corporates, with networks in
Africa ,Russia , Central andEastern Europe and specialised businesses that are leaders in their markets; - Global Banking and Investor Solutions, which offers recognised expertise, key international locations and integrated solutions.
In case of doubt regarding the authenticity of this press release, please go to the end of SocieteGenerale’s newsroom page where official Press Releases sent by
For more information, you can follow us on Twitter @societegenerale or visit our website www.societegenerale.com.
(1) Underlying data (see methodology note section 10.5 for the transition from accounting data to underlying data)
(2) Phased-in ratio (fully-loaded ratio of 13.6%) after distribution provision
The footnote * in this document corresponds to data adjusted for changes in Group Structure and at constant exchange rates
(1) NPL ratio calculated according to the EBA methodology published on
(2) Ratio between the amount of provisions on doubtful outstandings and the amount of these same outstandings
(2) After deducting interest on deeply subordinated notes and undated subordinated notes
(1) Amounts restated compared with the financial statements published in 2020 (See Note1.7 of financial statements)
(1) SG
(1) Phased-in (13.6% fully-loaded) post distribution provision
(2) After deducting interest on deeply subordinated notes and undated subordinated notes
Attachment
- Q4-21-Financial-Results-Press-Release
© OMX, source