RESULTS AT | |
Press release
Q3 21:EXCELLENT QUARTER, UNDERLYING GROUP NET INCOME OF
Revenues up +14.9% vs. Q3 20 (+15.0%*) driven by growth in all the businesses, in particular a very strong momentum in Financial Services and Financing & Advisory, a very good performance by Global Markets, and continued growth in Retail Banking
Underlying gross operating income:
Still low cost of risk: 15 basis points in Q3 21, with no significant provision write-back
Profitability (ROTE): 10.9%(1)on an underlying basis and 12.7% on a reported basis in
Q3 21
9M 21:UNDERLYING GROUP NET INCOME OF
9M 20)
Underlying gross operating income:
Cost of risk: 16 basis points
Profitability (ROTE):10.4%(1)on an underlying basis and 10.0% on a reported basis in
9M 21
SOLID CAPITAL POSITION
Solid CET 1 ratio: 13.4%2(2) at
Organic capital generation: 61 basis points in the first 9 months of 2021
Attractive shareholder return
- Launch of the share buyback programme, for an amount of around
EUR 470 million , scheduled forNovember 4 th, with the programme expected to be finalised by end-2021 - Provision for distribution per share of
EUR 2 .03 in 9M 21 (financing both dividend and share buyback) consistent with a payout ratio of 50% of underlying Group net income3(3)
SUCCESSFULEXECUTION OF OUR STRATEGICPROJECTS
Detailed presentation of the new French Retail Banking operation (a full merger project progressing as scheduled)
Very satisfactory implementation of the strategy in Global Banking & Investor Solutions
Development of our differentiating assets (
Frédéric Oudéa, the Group’s Chief Executive Officer, commented:
“The Societe Generale group enjoyed an excellent quarter, with strong commercial and financial performances in all the businesses and improvement of the cost-income ratio. The group also continued to benefit from the quality of its loan portfolio, with a low cost of risk combined with a continued very prudent provisioning policy. Thanks to the unfailing commitment of the teams, the different strategic projects announced, in particular the creation of a new
- GROUP CONSOLIDATED RESULTS
In EURm | Q3 21 | Q3 20 | Change | 9M 21 | 9M 20 | Change | ||
Net banking income | 6,672 | 5,809 | +14.9% | +15.0%* | 19,178 | 16,275 | +17.8% | +20.0%* |
Operating expenses | (4,170) | (3,825) | +9.0% | +9.0%* | (13,025) | (12,363) | +5.4% | +6.6%* |
Underlying operating expenses(1) | (4,272) | (4,002) | +6.8% | +6.7%* | (12,594) | (12,186) | +3.3% | +4.6%* |
Gross operating income | 2,502 | 1,984 | +26.1% | +26.7%* | 6,153 | 3,912 | +57.3% | +63.4%* |
Underlying gross operating income(1) | 2,400 | 1,807 | +32.8% | +33.5%* | 6,584 | 4,089 | +61.0% | +67.0%* |
Net cost of risk | (196) | (518) | -62.2% | -62.4%* | (614) | (2,617) | -76.5% | -76.0%* |
Operating income | 2,306 | 1,466 | +57.3% | +58.7%* | 5,539 | 1,295 | x 4.3 | x 4.6* |
Underlying operating income(1) | 2,204 | 1,289 | +70.9% | +72.7%* | 5,970 | 1,472 | x 4.1 | x 4.3* |
Net profits or losses from other assets | 175 | (2) | n/s | n/s | 186 | 82 | x 2.3 | x 2.3* |
Impairment losses on goodwill | - | - | n/s | n/s | - | (684) | n/s | n/s |
Income tax | (699) | (467) | +49.7% | +50.9%* | (1,386) | (1,079) | +28.4% | +31.4%* |
Net income | 1,781 | 992 | +79.5% | +80.9%* | 4,343 | (386) | n/s | n/s |
O.w. non-controlling interests | (180) | (130) | +38.5% | +38.7%* | (489) | (342) | +43.0% | +43.5%* |
Reported Group net income | 1,601 | 862 | +85.7% | +87.3%* | 3,854 | (728) | n/s | n/s |
Underlying Group net income(1) | 1,391 | 742 | +87.4% | +89.3%* | 4,038 | 803 | x 5.0 | x 5.5* |
ROE | 11.1% | 5.7% | 8.7% | -3.0% | ||||
ROTE | 12.7% | 6.5% | 10.0% | -1.4% | ||||
UnderlyingROTE(1) | 10.9% | 5.5% | 10.4% | 1.0% |
(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 increased by +14.9% (+15.0%*) vs. Q3 20, driven by a very strong momentum in all the businesses and the beginning of the recognition of the second TLTRO allowance for around
French Retail Banking continued the progress initiated for several quarters. As a result, net banking income (excluding PEL/CEL provision) increased by +5.7% vs. Q3 20, driven by the recovery in net interest income and commissions.
International Retail Banking & Financial Services enjoyed strong revenue growth (+12.8%* vs.
Q3 20), driven by the excellent momentum in Financial Services to Corporates (+39.9%* vs. Q3 20) and Insurance (+10.2%* vs. Q3 20). International Retail Banking also continued to progress (+4.0%* vs. Q3 20).
Global Banking & Investor Solutions also turned in an excellent performance, with revenues up +16.1% vs. Q3 20. Financing & Advisory enjoyed very strong growth (+30.7% vs. Q3 20) while Global Markets activity remained robust (+8.4% vs. Q3 20).
In 9M 21, the Group posted strong growth of +17.8% (+20.0%*) vs. 9M 20, with a positive contribution from all the businesses, and returned to a higher revenue level than in 9M 19 (EUR 18.5 billion).
Operating expenses
In Q3 21, operating expenses totalled
Driven by a positive jaws effect, underlying gross operating income rose +32.8% to
In 9M 21, costs amounted to
Cost of risk
In Q3 21, the commercial cost of risk stood at a low level of 15 basis points, or
The Group’s provisions on performing loans currently amount to
As part of the support provided to its customers during the crisis, the Group granted State Guaranteed Loans. At
The gross doubtful outstandings ratio amounted to 3.1%4(1) at
The cost of risk is not expected to exceed 20 basis points in 2021.
Group net income
In EURm | Q3 21 | Q3 20 | 9M 21 | 9M 20 |
1,601 | 862 | 3,854 | (728) | |
1,391 | 742 | 4,038 | 803 | |
In % | Q3 21 | Q3 20 | 9M 21 | 9M 20 |
ROTE | 12.7% | 6.5% | 10.0% | -1.4% |
Underlying ROTE(1) | 10.9% | 5.5% | 10.4% | 1.0% |
Earnings per share amounts to
- 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 130% at
The Group’s risk-weighted assets (RWA), including IFRS9 phasing, amounted to
At
The leverage ratio stood at 4.5% at
With a level of 29.9% of RWA and 8.6% 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 | Q3 21 | Q3 20 | Change | 9M 21 | 9M 20 | Change |
Net banking income | 1,976 | 1,836 | +7.6% | 5,729 | 5,470 | +4.7% |
Net banking income excl. PEL/CEL | 1,963 | 1,857 | +5.7% | 5,711 | 5,511 | +3.6% |
Operating expenses | (1,351) | (1,292) | +4.6% | (4,101) | (3,975) | +3.2% |
Gross operating income | 625 | 544 | +14.9% | 1,628 | 1,495 | +8.9% |
Gross operating income excl. PEL/CEL | 612 | 565 | +8.3% | 1,610 | 1,536 | +4.8% |
Net cost of risk | 5 | (130) | -103.8% | (124) | (821) | -84.9% |
Operating income | 630 | 414 | +52.2% | 1,504 | 674 | x 2.2 |
Net profits or losses from other assets | (2) | 3 | -166.7% | 2 | 139 | -98.6% |
Reported Group net income | 451 | 283 | +59.4% | 1,092 | 562 | +94.3% |
Underlying Group net income (1) | 414 | 274 | +50.9% | 1,107 | 613 | +80.6% |
RONE | 16.4% | 9.5% | 13.0% | 6.5% | ||
UnderlyingRONE(1) | 15.0% | 9.2% | 13.2% | 7.1% |
(1) Adjusted for the linearisation of IFRIC 21 and PEL/CEL provision
Societe Generale and Crédit du Nord networks:
Average loan outstandings were 2% lower than in Q3 20 at
Average outstanding balance sheet deposits7(2) increased by +7% vs. Q3 20 to
As a result, the average loan/deposit ratio stood at 87% in Q3 21 vs. 95% in Q3 20.
Insurance assets under management totalled
Private Banking’s assets under management totalled
Property/casualty insurance premiums were up +3% vs. Q3 20, as were personal protection insurance premiums (+3% vs. Q3 20).
The bank consolidated its position as the leading online bank in
This quarter,
Average outstanding loans rose +28% vs. Q3 20 to
Average outstanding savings including deposits and financial savings were 30% higher than in Q3 20 at
Q3 20.
Net banking income excluding PEL/CEL
Q3 21: revenues (excluding PEL/CEL) totalled
9M 21: revenues (excluding PEL/CEL) totalled
Operating expenses
Q3 21: operating expenses totalled
9M 21: operating expenses totalled
Cost of risk
Q3 21: the commercial cost of risk represented a write-back of
9M 21: the commercial cost of risk amounted to
Contribution to Group net income
Q3 21: the contribution to Group net income was
9M 21: the contribution to Group net income was
- INTERNATIONAL RETAIL BANKING & FINANCIAL SERVICES
In EURm | Q3 21 | Q3 20 | Change | 9M 21 | 9M 20 | Change | ||
Net banking income | 2,107 | 1,891 | +11.4% | +12.8%* | 5,958 | 5,605 | +6.3% | +9.8%* |
Operating expenses | (1,015) | (999) | +1.6% | +2.3%* | (3,115) | (3,124) | -0.3% | +2.6%* |
Gross operating income | 1,092 | 892 | +22.4% | +24.7%* | 2,843 | 2,481 | +14.6% | +19.0%* |
Net cost of risk | (145) | (331) | -56.2% | -56.7%* | (408) | (978) | -58.3% | -57.0%* |
Operating income | 947 | 561 | +68.8% | +75.0%* | 2,435 | 1,503 | +62.0% | +69.0%* |
Net profits or losses from other assets | 4 | (2) | n/s | n/s | 10 | 9 | +11.1% | +11.1%* |
Reported Group net income | 584 | 337 | +73.3% | +80.0%* | 1,498 | 928 | +61.4% | +69.4%* |
Underlying Group net income (1) | 570 | 323 | +76.5% | +83.7%* | 1,512 | 942 | +60.5% | +68.3%* |
RONE | 22.6% | 12.9% | 19.7% | 11.6% | ||||
UnderlyingRONE(1) | 22.1% | 12.3% | 19.9% | 11.8% |
(1) Adjusted for the linearisation of IFRIC 21
International Retail Banking’s loan and deposit production experienced an increase in all geographical regions. Outstanding loans totalled
For the
In
In
In the Insurance business, the life insurance savings business saw outstandings increase +8%* at
Financial Services to Corporates also enjoyed a healthy momentum.
Net banking income
Net banking income amounted to
International Retail Banking’s net banking income totalled
The Insurance business posted net banking income up +10.2%* vs. Q3 20, at
Q3 21. The gross premiums of the life insurance savings business were 59%* higher in Q3 21 than in Q3 20, with an attractive share of unit-linked products (43%). Protection insurance saw an increase of +7%* vs. Q3 20. Property/casualty premiums rose +10%* (including +8%* in
Financial Services to Corporates’ net banking income was substantially higher (+39.9%*) than in
Q3 20, at
9M 21, up +32.6%* vs. 9M 20.
Operating expenses
Operating expenses totalled
In International Retail Banking, operating expenses were up +3.4%* vs. Q3 20. Operating expenses were slightly higher (+2.0%*) in 9M 21 than in 9M 20.
In the Insurance business, operating expenses were in line with the expansion ambitions and rose +4.5%* vs. Q3 20 and +4.3%* vs. 9M 20.
In Financial Services to Corporates, operating expenses increased by +2.0%* vs. Q3 20 and +4.1%* vs. 9M 20.
Cost of risk
Q3 21: the commercial cost of risk amounted to 43 basis points (
9M 21: the cost of risk amounted to 41 basis points (
Contribution to Group net income
The contribution to Group net income totalled
- GLOBAL BANKING & INVESTOR SOLUTIONS
In EURm | Q3 21 | Q3 20 | Change | 9M 21 | 9M 20 | Change | ||
Net banking income | 2,361 | 2,034 | +16.1% | +15.4%* | 7,210 | 5,541 | +30.1% | +32.5%* |
Operating expenses | (1,608) | (1,478) | +8.8% | +8.2%* | (5,307) | (5,025) | +5.6% | +6.9%* |
Gross operating income | 753 | 556 | +35.4% | +34.5%* | 1,903 | 516 | x 3.7 | x 4* |
Net cost of risk | (57) | (57) | - | - | (83) | (818) | -89.9% | -89.5%* |
Operating income | 696 | 499 | +39.5% | +38.4%* | 1,820 | (302) | n/s | n/s |
Group net income | 563 | 381 | +47.8% | +46.6%* | 1,441 | (223) | n/s | n/s |
Underlying Group net income (1) | 467 | 295 | +58.0% | +56.4%* | 1,537 | (137) | n/s | n/s |
RONE | 14.7% | 10.3% | 13.1% | -2.1% | ||||
UnderlyingRONE(1) | 12.2% | 7.9% | 14.0% | -1.3% |
(1) Adjusted for the linearisation of IFRIC 21
Net banking income
In Q3 21, Global Banking & Investor Solutions enjoyed a healthy momentum in its businesses, with revenues of
In 9M 21, revenues rose +30.1% vs. 9M 20 (EUR 7,210 million vs.
In Global Markets & Investor Services, net banking income totalled
Q3 20). It amounted to
The Equity market was active, driven by commercial activity that remained buoyant throughout the quarter. The business posted revenues of
Revenues totalled
Market conditions were less favourable for the Fixed Income franchise model: substantial spread compression on financing, coupled with reduced client demand in Fixed Income markets. The environment was also unfavourable in
Q3 21, down -33% vs. a good Q3 20.
Revenues were 21% lower in 9M 21 compared to the exceptionally high level in 9M 20.
Securities Services’ revenues saw a further increase, with revenues up +6.9% vs. Q3 20, at
Securities Services’ assets under custody amounted to
EUR 680 billion.
Financing & Advisory delivered the best historical performance, with revenues of
Investment Banking enjoyed an excellent quarter, driven by the strong momentum of advisory, M&A and Leveraged Buyout activities. Revenues from
Global Transaction and Payment Services continued to enjoy strong growth, up +23% vs. Q3 20.
Asset and Wealth Management’s net banking income totalled
Q3 20). It was 6% higher in 9M 21.
Private Banking posted a substantial increase in its revenues (+20% vs. Q3 20) to
Net banking income totalled
Assets under management totalled
Lyxor’s net banking income amounted to
Revenues were 17% higher in 9M 21 than in 9M 20, with net inflow of EUR +14 billion.
Operating expenses
Q3 21: operating expenses totalled
9M 21: operating expenses were up +5.6% on a reported basis and +5.4% on an underlying basis.
Net cost of risk
Q3 21: the commercial cost of risk amounted to 14 basis points (or
9M 21: it was at a low level of 7 basis points, well below 9M 20 (66 basis points) which was adversely affected by the health crisis.
Contribution to Group net income
Q3 21: the contribution to Group net income was
Q3 20) and
9M 21: it was
Global Banking & Investor Solutions posted a significant underlying RONE of 12.2% in Q3 21 and 14.0% in 9M 21.
- CORPORATE CENTRE
In EURm | Q3 21 | Q3 20 | 9M 21 | 9M 20 |
Net banking income | 228 | 48 | 281 | (341) |
Operating expenses | (196) | (56) | (502) | (239) |
Underlying operating expenses (1) | (110) | (69) | (259) | (226) |
Gross operating income | 32 | (8) | (221) | (580) |
Underlying gross operating income (1) | 118 | (21) | 22 | (567) |
Net cost of risk | 1 | - | 1 | - |
Impairment losses on goodwill | - | - | - | (684) |
Income tax | (166) | (84) | (6) | (534) |
Reported Group net income | 3 | (139) | (177) | (1,995) |
Underlying Group net income (1) | (69) | (137) | (132) | (586) |
(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
Treasury function for the Group, - certain costs related to cross-functional projects as well as certain costs incurred by the Group and not re-invoiced to the businesses.
The Corporate Centre’s net banking income totalled
Operating expenses totalled EUR 196 million in Q3 21 vs.
Operating expenses totalled
Gross operating income totalled EUR 32 million in Q3 21 vs.
The Corporate Centre’s contribution to Group net income was EUR 3 million in Q3 21 vs.
- CONCLUSION
The Group delivered an excellent performance in the first 9 months of 2021. All the businesses experienced healthy revenue growth, compared to the first 9 months of 2020, and a improvement in their cost to income ratio due to disciplined cost management.
At
Furthermore, the Group continues to execute its strategy with the achievement, this quarter, of a new key milestone. On
- 2021 FINANCIAL CALENDAR
2021 Financial communication calendar |
The Alternative Performance Measures, notably the notions of net banking income for the pillars, operating expenses, IFRIC 21 adjustment, (commercial) 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, |
- APPENDIX 1: FINANCIAL DATA
GROUP NET INCOME BY CORE BUSINESS
In EURm | Q3 21 | Q3 20 | Change | 9M 21 | 9M 20 | Change |
French Retail Banking | 451 | 283 | 59.4% | 1,092 | 562 | 94.3% |
International Retail Banking and Financial Services | 584 | 337 | 73.3% | 1,498 | 928 | 61.4% |
Global Banking and Investor Solutions | 563 | 381 | 47.8% | 1,441 | (223) | n/s |
Core Businesses | 1,598 | 1,001 | 59.6% | 4,031 | 1,267 | x 3.2 |
Corporate Centre | 3 | (139) | n/s | (177) | (1,995) | 91.1% |
Group | 1,601 | 862 | 85.7% | 3,854 | (728) | n/s |
CONSOLIDATED BALANCE SHEET
30.09.2021 | 31.12.2020 | |
Cash, due from central banks | 176,531 | 168,179 |
Financial assets at fair value through profit or loss | 436,594 | 429,458 |
Hedging derivatives | 14,021 | 20,667 |
Financial assets measured at fair value through other comprehensive income | 45,780 | 52,060 |
Securities at amortised cost | 18,687 | 15,635 |
Due from banks at amortised cost | 66,144 | 53,380 |
Customer loans at amortised cost | 475,923 | 448,761 |
Revaluation differences on portfolios hedged against interest rate risk | 172 | 378 |
Investment of insurance activities | 174,240 | 166,854 |
Tax assets | 4,307 | 5,001 |
Other assets | 78,469 | 67,341 |
Non-current assets held for sale | 390 | 6 |
Investments accounted for using the equity method | 95 | 100 |
Tangible and intangible assets | 31,180 | 30,088 |
3,821 | 4,044 | |
Total | 1,526,354 | 1,461,952 |
30.09.2021 | 31.12.2020 | |
Central banks | 6,684 | 1,489 |
Financial liabilities at fair value through profit or loss | 386,465 | 390,247 |
Hedging derivatives | 9,576 | 12,461 |
Debt securities issued | 133,194 | 138,957 |
Due to banks | 148,430 | 135,571 |
Customer deposits | 497,155 | 456,059 |
Revaluation differences on portfolios hedged against interest rate risk | 4,250 | 7,696 |
Tax liabilities | 1,683 | 1,223 |
Other liabilities | 96,568 | 84,937 |
Non-current liabilities held for sale | 125 | - |
Liabilities related to insurance activities contracts | 152,619 | 146,126 |
Provisions | 4,491 | 4,775 |
Subordinated debts | 15,826 | 15,432 |
Total liabilities | 1,457,066 | 1,394,973 |
SHAREHOLDERS' EQUITY | ||
Shareholders' equity, Group share | ||
Issued common stocks and capital reserves | 22,364 | 22,333 |
Other equity instruments | 7,534 | 9,295 |
Retained earnings | 30,866 | 32,076 |
Net income | 3,854 | (258) |
Sub-total | 64,618 | 63,446 |
Unrealised or deferred capital gains and losses | (980) | (1,762) |
Sub-total equity, Group share | 63,638 | 61,684 |
Non-controlling interests | 5,650 | 5,295 |
Total equity | 69,288 | 66,979 |
Total | 1,526,354 | 1,461,952 |
- APPENDIX 2: METHODOLOGY
1 –The financial information presented in respect of Q3 and 9M 2021 was examined by the Board of Directors on November 3rd, 2021 and has been prepared in accordance with IFRS as adopted in the
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.
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:
Q3 21 (in EURm) | Operating Expenses | Net profit or losses from other assets | Impairment losses on goodwill | Income tax | Group net income | Business |
Reported | (4,170) | 175 | 0 | (699) | 1,601 | |
(+) IFRIC 21 linearisation | (199) | 46 | (149) | |||
(+) Transformation charges12(*) | 97 | (27) | 70 | Corporate Center13(1) | ||
(+) Capital gains on Haussmann office disposal(*) | (185) | 53 | (132) | Corporate Center | ||
Underlying | (4,272) | (10) | 0 | (627) | 1,391 | |
Q3 20 (in EURm) | Operating Expenses | Net profit or losses from other assets | Impairment losses on goodwill | Income tax | Group net income | Business |
Reported | (3,825) | (2) | 0 | (467) | 862 | |
(+) IFRIC 21 linearisation | (177) | 53 | (120) | |||
Underlying | (4,002) | (2) | 0 | (414) | 742 |
9M 21 (in EURm) | Operating Expenses | Net profit or losses from other assets | Impairment losses on goodwill | Income tax | Group net income | Business |
Reported | (13,025) | 186 | 0 | (1,386) | 3,854 | |
(+) IFRIC 21 linearisation | 199 | (46) | 149 | |||
(+) Transformation charges(*) | 232 | (65) | 167 | Corporate Center14(2) | ||
(+) Capital gains on Haussmann office disposal(*) | (185) | 53 | (132) | Corporate Center | ||
Underlying | (12,594) | 1 | 0 | (1,444) | 4,038 | |
9M 20 (in EURm) | Operating Expenses | Net profit or losses from other assets | Impairment losses on goodwill | Income tax | Group net income | Business |
Reported | (12,363) | 82 | (684) | (1,079) | (728) | |
(+) IFRIC 21 linearisation | 177 | (53) | 120 | |||
(+) Group refocusing plan | 77 | 77 | Corporate center | |||
(-) | 684 | 684 | Corporate center | |||
(-) DTA impairment(*) | 650 | 650 | Corporate center | |||
Underlying | (12,186) | 159 | 0 | (482) | 803 |
6 - Cost of risk in basis points, coverage ratio for doubtful outstandings
The cost of risk or commercial 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 EUR m) | Q3 21 | Q3 20 | 9M 21 | 9M 20 | |
French Retail Banking | Net Cost Of Risk | (5) | 130 | 124 | 821 |
Gross loans Outstanding | 217,332 | 217,156 | 217,549 | 208,604 | |
Cost of Risk in bp | (1) | 24 | 8 | 52 | |
International Retail Banking and Financial Services | Net Cost Of Risk | 145 | 331 | 408 | 978 |
Gross loans Outstanding | 134,725 | 129,838 | 132,088 | 133,240 | |
Cost of Risk in bp | 43 | 102 | 41 | 98 | |
Global Banking and Investor Solutions | Net Cost Of Risk | 57 | 57 | 83 | 818 |
Gross loans Outstanding | 167,410 | 162,429 | 161,432 | 165,389 | |
Cost of Risk in bp | 14 | 14 | 7 | 66 | |
Corporate Centre | Net Cost Of Risk | (1) | 0 | (1) | 0 |
Gross loans Outstanding | 14,244 | 12,400 | 13,589 | 10,800 | |
Cost of Risk in bp | (1) | (1) | (1) | 1 | |
Societe | Net Cost Of Risk | 196 | 518 | 614 | 2,617 |
Gross loans Outstanding | 533,711 | 521,822 | 524,659 | 518,033 | |
Cost of Risk in bp | 15 | 40 | 16 | 67 |
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 | Q3 21 | Q3 20 | 9M 21 | 9M 20 |
Shareholders' equity Group share | 63,638 | 60,593 | 63,638 | 60,593 |
Deeply subordinated notes | (7,820) | (7,873) | (7,820) | (7,873) |
Undated subordinated notes | (274) | (274) | ||
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 | (34) | (4) | (34) | (4) |
OCI excluding conversion reserves | (613) | (875) | (613) | (875) |
Dividend provision (1) | (1,726) | (178) | (1,726) | (178) |
ROE equity end-of-period | 53,445 | 51,389 | 53,445 | 51,389 |
Average ROE equity | 52,947 | 51,396 | 52,215 | 52,352 |
Average | (3,927) | (3,928) | (3,927) | (4,253) |
Average Intangible Assets | (2,599) | (2,464) | (2,549) | (2,417) |
Average ROTE equity | 46,421 | 45,004 | 45,739 | 45,682 |
Group net Income (a) | 1,601 | 862 | 3,854 | (728) |
1,391 | 742 | 4,038 | 803 | |
Interest on deeply subordinated notes and undated subordinated notes (c) | (130) | (127) | (439) | (447) |
Cancellation of goodwill impairment (d) | 684 | |||
Ajusted Group net Income (e) = (a)+ (c)+(d) | 1,471 | 735 | 3,415 | (491) |
Ajusted | 1,261 | 615 | 3,599 | 356 |
Average ROTE equity (g) | 46,421 | 45,004 | 45,739 | 45,682 |
ROTE [quarter: (4*e/g), 9M: (4/3*e/g)] | 12.7% | 6.5% | 10.0% | -1.4% |
Underlying ROTE | 46,210 | 44,884 | 45,923 | 47,213 |
Underlying ROTE [quarter: (4*f/h), 9M: (4/3*f/h)] | 10.9% | 5.5% | 10.4% | 1.0% |
RONE calculation: Average capital allocated to Core Businesses (in EURm)
In EURm | Q3 21 | Q3 20 | Change | 9M 21 | 9M 20 | Change |
French Retail Banking | 11,025 | 11,879 | -7.2% | 11,201 | 11,507 | -2.7% |
International Retail Banking and Financial Services | 10,340 | 10,468 | -1.2% | 10,154 | 10,627 | -4.5% |
Global Banking and Investor Solutions | 15,327 | 14,868 | 3.1% | 14,687 | 14,306 | 2.7% |
Core Businesses | 36,693 | 37,215 | -1.4% | 36,042 | 36,440 | -1.1% |
Corporate Center | 16,254 | 14,180 | 14.6% | 16,173 | 15,912 | 1.6% |
Group | 52,947 | 51,396 | 3.0% | 52,215 | 52,352 | -0.3% |
(
(1) The provision is calculated on a payout ratio of 50% of underlying Group net income, excluding linearisation of IFRIC 21, after deducting interest on deeply subordinated notes and undated subordinated notes
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 | 9M 21 | H1 21 | 2020 |
Shareholders' equity Group share | 63,638 | 63,136 | 61,684 |
Deeply subordinated notes | (7,820) | (8,905) | (8,830) |
Undated subordinated notes | - | (62) | (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 | (34) | (1) | 19 |
Bookvalue of own shares in trading portfolio | (45) | (46) | 301 |
Net Asset Value | 55,739 | 54,122 | 52,910 |
(3,927) | (3,927) | (3,928) | |
Intangible Assets | (2,641) | (2,556) | (2,484) |
Net Tangible Asset Value | 49,171 | 47,639 | 46,498 |
Number of shares used to calculate NAPS* | 850,430 | 850,429 | 848,859 |
Net Asset Value per Share | 65.5 | 63.6 | 62.3 |
Net Tangible Asset Value per Share | 57.8 | 56.0 | 54.8 |
* The number of shares considered is the number of ordinary shares outstanding as at
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) | 9M 21 | H1 21 | 2020 |
Existing shares | 853,371 | 853,371 | 853,371 |
Deductions | |||
Shares allocated to cover stock option plans and free shares awarded to staff | 3,335 | 3,466 | 2,987 |
Other own shares and treasury shares | |||
Number of shares used to calculate EPS** | 850,036 | 849,905 | 850,385 |
Group net Income | 3,854 | 2,253 | (258) |
Interest on deeply subordinated notes and undated subordinated notes | (439) | (309) | (611) |
Capital gain net of tax on partial buybacks | |||
Adjusted Group net income | 3,415 | 1,944 | (869) |
EPS (in EUR) | 4.02 | 2.29 | (1.02) |
Underlying EPS* (in EUR) | 4.06 | 2.40 | 0.97 |
(*) Calculated on the basis of underlying Group net income excluding linearisation of IFRIC 21. Or
(**) The number of shares considered is the number of ordinary shares outstanding as at
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 , Crédit 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 the event of any doubt regarding the authenticity of this press release, go to the bottom of the newsroom of societegenerale.com. Press releases from
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(1) Underlying data (see methodology note No. 5 for the transition from accounting data to underlying data)
(2) Phased-in ratio; fully-loaded ratio of 13.2%
(3) After deducting interest on deeply subordinated notes and undated subordinated notes
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
(1) Underlying data (see methodology note No. 5 for the transition from accounting data to underlying data)
(2) Including BMTN (negotiable medium-term notes)
(2) SG
(1) Based on ALD local data
(1) Phased-in ratio; fully-loaded ratio of 13.2%
(2) Based on a payout ratio of 50% of underlying Group net income after deducting interest on deeply subordinated notes and undated subordinated notes
(*) Exceptional item
(1) Transformation and/or restructuring charges in Q3 21 related to French Retail Banking (
(2) Transformation and/or restructuring charges in 9M 21 related to French Retail Banking (
Attachment
Societe Generale _ Q3-2021-Financial-Results-Press-Release
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