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The bank reported a revenue hit of 7 billion euros for the quarter while its operating expenses topped 4.5 billion euros.
French multinational banking giant Societe Generale SA (EPA: GLE) posted a 3.3 billion euro ($3.36 billion) loss in its second quarter.
This loss was fueled by the bank’s exit from Russia after the Kremlin’s invasion of Ukraine. While it has many investments in Russia which it grew for years, the company describes its exit from the country as a sad but necessary move.
Besides this reported loss, Societe Generale saw good growth across most of its business segments including its retail and global banking units respectively. According to the figures posted, the retail banking unit saw a net profit of 18.7% higher than the previous quarter while the global banking unit grew by almost 50% in income when compared to the previous quarter.
“Q2 2022 concluded two years of intense and disciplined execution of our various strategic projects. We have successfully simplified and strengthened the resilience of our business model, transformed our businesses to support the changing needs of our customers and the far-reaching transformations around digital technologies and ESG, and invested in a targeted manner in businesses with strong growth potential,” said Fréderic Oudéa, the Group’s Chief Executive Officer.
According to Oudéa, the first half of the year saw the bank combine “strong growth in revenues and underlying profitability above 10% (ROTE) and we were able to manage our exit from the Russian activities without significant capital impact and without handicapping the Group’s strategic developments.”
He noted that “these dynamics and performances make us confident regarding both the short term, in an undeniably more uncertain environment, and in the medium term. By 2025, having reaped all the benefits of the numerous strategic and operating efficiency initiatives under way, we confirm our ability to deliver profitability of 10% on the basis of a target core Tier 1 capital ratio of 12%, while maintaining an attractive distribution policy for our shareholders.”
Other Highlights of Societe Generale Revenue Record amid Russia-Fueled Loss
The bank reported a revenue hit of 7 billion euros for the quarter while its operating expenses topped 4.5 billion euros. The banking giant recorded a 12.9% CET1 ratio at the end of June. The CET1 Ratio is used to measure a bank’s solvency.
In all of its revenue performance records, Societe Generale said its international retail banking segment surged by 33% in the past quarter when compared to the first three months of the year. The company’s performance is visible and is being acknowledged by its investors, many of whom have gone on a buying spree since the report was posted.
At the time of writing, Societe Generale shares are changing hands at 22.52 euros, up 4.04% from the past 24 hours. Despite this immediate stock price growth, the banking giant, like the general stock market has buckled under the global economic uncertainty and the shares are down by 23% in the year-to-date period.