SocGen cuts outlook for French retail bank, shares tumble

Societe Generale tumbled on Thursday after cutting the outlook for its French retail bank.

In its results for the second quarter, the bank said it now expects net interest income for the French retail, private banking and insurance business to be around €3.8bn for 2024, down from previous expectations of €4.1bn.

For the second quarter, SocGen reported a 24% jump in net income to €1.1bn, coming in ahead of forecasts for €973m.

Meanwhile, quarterly revenues were €6.7bn, up 6.3% on the second quarter of 2023. SocGen said this was driven by an "excellent" quarter for global markets and transaction banking, increased margins at Ayvens and net interest income recovery underway in France.

Chief executive Slawomir Krupa said: "Growth in revenues, combined with our disciplined costs and risks management, allows us to significantly improve our cost-to-income ratio and profitability. Our capital and liquidity ratios remain very strong. We continue to move forward in an orderly and efficient manner with the implementation of our strategic roadmap, as demonstrated in the sustained development of BoursoBank which is exceeding the 6.5 million clients threshold, and as shown by the launch of the first phase of our 1 billion euros investment dedicated to the energy transition.

"We also continue to simplify our business portfolio and are determined to capitalise on those positive dynamics to pursue the successful execution of our strategic plan in order to build a more profitable bank and create more value over the long term for all our stakeholders."

At 1255 BST, the shares were down 8% at €22.05.