GLE Societe Generale SA

   By Pietro Lombardi 
 

Societe Generale SA said it will cut costs further this year after it swung to a loss in the first quarter as the bank set aside more provisions and was hit by the weak performance of its investment banking operations.

France's third-largest listed bank by assets said Thursday that net loss for the quarter was 326 million euros ($353.9 million) compared with a profit of EUR686 million a year earlier.

Net banking income, the bank's top-line revenue figure, fell almost 17% to EUR5.17 billion.

The performance of the bank's global banking and investor-solutions business, which includes investment banking and asset management, weighed on the performance. The division swung to a loss of EUR537 million from a profit of EUR140 million, and posted a 27% decline in revenue. Fixed-income revenue rose 32% but SocGen reported a 99% decline in equities revenue.

Cost of risk more than tripled, "marked by an increase of provisioning in the context of the Covid-19 crisis and some specific files, including two exceptional fraud files," it said.

The bank targets further cost cuts of up to EUR700 million this year. It sees cost of risk of between 70 and 100 basis points, depending on the evolution of the pandemic and expects its core Tier 1 ratio to show a buffer of between 200 and 250 basis points over regulatory requirement.

Write to Pietro Lombardi at pietro.lombardi@dowjones.com

(END) Dow Jones Newswires

April 30, 2020 01:52 ET (05:52 GMT)

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