Societe Generale: Fourth quarter & 2023 full year results
RESULTS AT 31 DECEMBER 2023
Press
release Paris,
8 February 2024
AFTER A YEAR OF TRANSITION AND
TRANSFORMATION IN 2023, A YEAR
FOCUSED ON THE EXECUTION OF OUR NEW STRATEGIC ROADMAP IN
2024
FULL-YEAR
RESULTS
Revenues of EUR 25.1
billion, down by -7.6% vs.
2022Reported cost-to-income ratio at
73.8%, stable operating expenses (+0.3% vs. 2022)
at constant perimeter1, transformation charges of around EUR 730
million in 2023Low cost of risk at 17 basis
points, high S1/S2 inventory at ~EUR 3.6 billion
at end 2023
Group net income of EUR 2.5
billion, up +37% vs. 2022
Reported ROTE at
4.2%
CET 1 ratio of
13.1%2
at end-2023, around 340 basis
points above regulatory requirement
Liquidity Coverage Ratio at 160% at
end-2023
Deposit base up by around +4% vs.
2022
QUARTERLY
RESULTS
Quarterly revenues of EUR 6.0
billion, down by -9.9% vs. Q4 22
Reported cost-to-income ratio at 78.3% at Q4
23, operating expenses down by -1.5% vs. Q4 22 at
constant perimeter1
Low cost of risk of 24 basis
points in Q4 23
Group net income of EUR 430
million, down -60% vs. Q4 22
Reported ROTE at
1.7%
MAIN
HIGHLIGHTS
Strong annual and quarterly performance
for Global Banking & Investor Solutions, and International
Retail BankingBeginning of the rebound in net
interest income for French retail during Q4 23, in a year
marked by the negative impact of short-term hedgesRecord
annual and quarterly organic client acquisition at
BoursoBank, 6 million clients reached in January
2024Determination of LeasePlan’s purchase price allocation
process leading notably to a EUR 220 million
reduction in the amount of goodwillStrengthened ESG
commitments, notably through a 80% reduction in upstream
Oil & Gas exposure by 2030 vs. 2019, the signature of new
partnerships with the IFC and The Ocean Cleanup, and the setting of
new NZBA alignment targets on 7 sectors
DISTRIBUTION TO
SHAREHOLDERS
Proposed
distribution3
of around EUR 1 billion, equivalent to EUR 1.25 per
share4,
i.e.:
-
a cash dividend of EUR 0.90 per
share to be proposed to the General Meeting
-
a share buyback programme, of
around EUR 280 million, equivalent to EUR 0.35 per
share
2024: BETTER PERFORMANCE THROUGH
STRATEGIC PLAN EXECUTION
Enhanced commercial
performance, notably by the deployment of new
relationship model and front office reorganisation in core
franchises (implementation of the new operating model in the French
networks, overhaul of the setup of Financing and Advisory
activities and in-depth transformation of Ayvens)
Business portfolio
management, notably with the finalisation of
previously announced disposals (in addition to Congo and Chad
subsidiaries already finalised)
Linear improvement of
operational efficiency (around EUR 500 million in
additional gross savings in 2024, with EUR 750-800 million in
transformation costs)
Strong capital and liquidity
ratios with limited organic RWA growth (<1%
vs. 2023)
Disciplined risk
management
Maintain pace in the deployment
of our initiatives and strategic ambitions in
ESG
2024 FINANCIAL
TARGETS5
Revenue growth at or above +5%
vs. 20236
Cost-to-income ratio less than
71% in 2024
Net cost of risk between 25 and
30 basis points in 2024
ROTE of more than
6% in 2024
CET1 ratio of around
13% at end-2024
Slawomir Krupa, the Group’s Chief
Executive Officer, commented:
“2023 was a year of transition and
transformation. The exceptional momentum of BoursoBank, the
strength of our Global Banking and Investor Solutions franchises,
the performance of our international banking activities across all
regions, plus the capacity of our new bank in France and Ayvens to
implement unprecedented transformations are all strong proof points
on our ability to execute at a high level. At the same time, while
2023 was negatively affected by a sharp decrease in net interest
income in French Retail Banking and the elevated cost of
integrating LeasePlan, it was also characterised by disciplined
management of costs, risks and capital.
Drawing on our new strategic and financial plan
that was presented in September 2023, we are writing a new chapter
in the history of the Group, which, for the last 160 years, has
assisted millions of clients by way of responsible, long-term
relationships. At their service day after day, we support their
development and projects, and our contribution to their growth and
to unlocking their potential is a source of pride for us.
Our ambition is to position Societe Generale
among Europe’s top-tier, rock-solid and sustainable banks, and to
create long-term value for all our stakeholders, including
unequivocal commitment to supporting the United Nations’
Sustainable Development Goals.
We are entering 2024 with confidence and
determination, a year that will see the meticulous execution of our
strategic plan and an unwavering commitment to reach our financial
targets, which will notably involve improved operational
efficiency. We will provide precise, regular and transparent
reports on our progress toward our announced 2026 objectives.”
-
GROUP CONSOLIDATED RESULTS
In EURm |
Q4 23 |
Q4 22 |
Change |
2023 |
2022 |
Change |
Net banking income |
5,957 |
6,611 |
-9.9% |
-11.2%* |
25,104 |
27,155 |
-7.6% |
-8.2%* |
Operating expenses |
(4,666) |
(4,455) |
+4.7% |
-0.8%* |
(18,524) |
(17,994) |
+2.9% |
+0.6%* |
Gross operating income |
1,291 |
2,156 |
-40.1% |
-32.8%* |
6,580 |
9,161 |
-28.2% |
-25.8%* |
Net cost of risk |
(361) |
(413) |
-12.6% |
-13.4%* |
(1,025) |
(1,647) |
-37.8% |
-30.8%* |
Operating income |
930 |
1,743 |
-46.6% |
-37.5%* |
5,555 |
7,514 |
-26.1% |
-24.8%* |
Net profits or losses from other assets |
(21) |
(4) |
n/s |
n/s |
(113) |
(3,290) |
+96.6% |
+96.6%* |
Impairment losses on goodwill |
- |
- |
n/s |
n/s |
(338) |
- |
n/s |
n/s |
Income tax |
(302) |
(454) |
-33.4% |
-33.4%* |
(1,679) |
(1,483) |
+13.2% |
+15.9%* |
Net income |
613 |
1,292 |
-52.6% |
-40.2%* |
3,449 |
2,756 |
+25.2% |
+28.4%* |
O.w. non-controlling interests |
183 |
222 |
-17.6% |
+5.9%* |
956 |
931 |
+2.7% |
+7.1%* |
Reported Group net income |
430 |
1,070 |
-59.8% |
-49.7%* |
2,493 |
1,825 |
+36.6% |
+39.1%* |
ROE |
1.5% |
6.3% |
|
|
3.1% |
2.2% |
+0.0% |
+0.0%* |
ROTE |
1.7% |
7.1% |
|
|
4.2% |
2.5% |
+0.0% |
+0.0%* |
Cost to income |
78.3% |
67.4% |
|
|
73.8% |
66.3% |
+0.0% |
+0.0%* |
Societe Generale’s Board of Directors, which met
on 7 February 2024 under the chairmanship of Lorenzo Bini Smaghi,
examined the Societe Generale Group’s results for Q4 23 and FY
2023.
Net banking
income
Despite the continued solid performance
by Global Banking and Investor Solutions and International Retail
Banking, net banking income recorded a decrease of -9.9% in Q4 23
vs. Q4 22, largely due to the decline in the net interest
income in French Retail, Private Banking & Insurance, and to
negative impacts in the Corporate Centre (in particular, impacts
from the unwinding of hedges on TLTRO operations for around EUR 30
million and negative changes in the fair value of economic hedges
that do not qualify for hedge accounting, amid a sharp decrease in
long-term rates in Q4 23).
Revenues recorded by French Retail, Private
Banking and Insurance decreased by -14.3% vs. Q4 22 owing to the
decline in net interest income which continues to be impacted by
short-term hedges that were taken before the period of higher
interest rates began in 2022. The quarter was nevertheless marked
by the beginning of the recovery of net interest income, the peak
of the negative impact of these hedges having been reached in Q3
23. Insurance revenues recorded a sharp rise of +42.9% vs. Q4 22 on
back of robust commercial activity.
Global Banking and Investor Solutions continued
to post a solid performance with revenues of
EUR 2.2 billion for the quarter, down -11.1% relative to
a very strong Q4 22. Global Markets and Investor Services’ revenues
decreased by -9.4% vs. Q4 22 owing to the unfavourable base effect
on Securities Services business following the revaluation of the
participation in Euroclear during Q4 22
(EUR +91 million). Global Markets’ revenues were down
slightly (-0.8%) with good commercial momentum in the equity
derivatives business and robust activity for fixed-income products.
Finance and Advisory recorded strong revenues of EUR 826 million in
Q4 23 that were nonetheless down -13.9% compared to the record Q4
22 level. Revenues were resilient in the Asset Finance and Natural
Resources finance platforms and solid in the securitisation
business. Investment banking revenues underwent a rebound and were
notably driven by the primary bond markets. Global Transaction
& Payment Services’ revenues were down relative to a strong Q4
22 performance largely due to rising deposit costs in the Cash
Management businesses.
International Retail Banking revenues rose +1.5%
vs. Q4 22. Despite LeasePlan’s contribution for EUR 178 million,
Mobility and Leasing Services’ decreased by -10.6%. Revenues were
impacted by one-off items notably the negative MtM of LeasePlan’s
hedging portfolio (for around EUR -150 million), normalising Used
Car Sales results and the determination of the LeasePlan’s Purchase
Price Allocation. In total, International Retail, Mobility and
Leasing Services’ revenues decreased by -4.5% vs. Q4 22.
The Corporate Centre recorded revenues of EUR
-196 million in Q4 23 which included around
EUR -30 million due to the unwinding of hedges on TLTRO
operations, in addition to a ~EUR -100 million impact linked to
negative changes in the fair value of economic hedges that do not
qualify for hedge accounting.
Over 2023, net banking income
decreased by -7.6% vs. 2022.
Operating
expenses
In Q4 23, operating expenses came to EUR
4,666 million, up +4.7% vs. Q4 22, but were down -1.5% at constant
perimeter.
They include EUR 278 million for the integration
of LeasePlan’s activities and EUR 102 million in transformation
charges, notably borne by Ayvens and Global Banking and Investor
Solutions.
Over 2023, operating expenses
totalled EUR 18,524 million, up by a moderate +2.9% vs. 2022. They
include EUR 617 million for the integration of LeasePlan’s
activities and EUR 730 million in transformation costs. At constant
perimeter, they rose by a very minor +0.3% despite the inflationary
context.
Cost of
risk
The cost of risk for Q4 23 was low at 24
basis points, i.e., EUR 361 million. It breaks down into a
provision on non-performing loans of EUR 364 million and a slight
reversal on performing loans for EUR -3 million.
Over 2023, the cost of risk
came to 17 basis points.
At end-December 2023, the Group’s provisions on
performing loans amounted to EUR 3,572 million, down EUR -197
million relative to 31 December 2022, notably linked to the strong
decrease of the Russian offshore portfolio (see below).
The gross coverage ratio stood at 2.9%7 at 31
December 2023. The net coverage ratio on the Group’s doubtful loans
stood at around 80%8 at 31 December 2023 (after taking into account
guarantees and collateral).
At 31 December 2023, the Group sharply reduced
its offshore exposure to Russia to around EUR 0.9 billion of EAD
(Exposure at Default) compared with EUR 1.8 billion at 31 December
2022 (-50%). The maximum risk exposure on this portfolio is
estimated at around EUR 0.3 billion before provision. Total
provisions stood at EUR 0.2 billion at end-2023. The onshore
residual exposure is marginal at around EUR 15 million and relates
to the integration during the year of LeasePlan activities in
Russia.
Group net
income
Group net income stood at EUR 430 million in Q4
23, i.e. Return on Tangible Equity (ROTE) of 1.7%.
Group net income for 2023 came to EUR 2.5
billion, i.e., ROTE of 4.2%.
Shareholder
distribution
The Board of Directors approved the distribution
policy for 2023 fiscal year aiming at distributing EUR 1.25 per
share9, equivalent to a total amount of around EUR 1 billion of
which around EUR 280 million in share buy-backs. A cash dividend of
EUR 0.90 per share will be proposed at the General Meeting of
Shareholders on 22 May 2024. The dividend will be detached on 27
May 2024 and paid out on 29 May 2024.
ESG
Societe Generale set two new alignment targets
this quarter as part of its Net Zero Banking Alliance (NZBA)
commitments, thereby taking to nine the sectors covered by
alignment targets out of the 12 sectors recommended by the
alliance:
- New target for the aluminium
sector: reduce carbon emission intensity by -25% by 2030 relative
to 202210, i.e., 6t CO2e/t in 2030 vs. 8t CO2e/t in 2022
- New target for the maritime
transport sector11: reduce carbon emission intensity by -43% by
2030 relative to 2022
The three remaining sectors (aviation,
agriculture and residential real estate financing) will be covered
by the end of the first half of 2024. Beyond the 7 new NZBA
alignment targets published since beginning 2023, Societe Generale
accelerated its decarbonisation of the oil and gas sector by
setting ambitious financing and absolute emissions targets.
The methodologies and resources implemented to
reach these targets are detailed in a transparent and global
transition report that was published in December 2023: Climate and
Alignment Report – December 2023 (societegenerale.com).
At 31 December 2023, the Group had already
reached EUR 250 billion of contribution to sustainable finance,
ahead of the target of EUR 300 billion between end-2021 and
end-2025.
In conjunction with the initiatives announced at
the Capital Markets Day event, two new partnerships were recently
signed with:
- The Ocean Cleanup in December 2023
to financially contribute to the international non-profit in
developing technologies to clean up plastic pollution in oceans and
stemming the inflow from rivers.
- The International Finance
Corporation (IFC), a member of the World Bank Group, with a
Collaboration Framework Agreement to develop sustainable financing
for developing countries and thereby contribute to the UN’s
Sustainable Development Goals (SDGs).
Finally, the appointment of Subra Suresh as
Chairman of the Group’s new Scientific Advisory Council is
effective from 1 February 2024.
2. THE
GROUP’S FINANCIAL STRUCTURE
Group shareholders’ equity
totalled EUR 66.0 billion at 31 December 2023 (vs. EUR 67.0 billion
at 31 December 2022). Net asset value per share was EUR 71.5 and
tangible net asset value per share stood at EUR 62.7.
The consolidated balance sheet totalled EUR
1,554 billion at 31 December 2023 vs. EUR 1,485 billion at 31
December 2022. The total funded balance sheet (see Methodology note
9) stood at EUR 970 billion vs. EUR 930 billion at 31 December
2022. The net amount of customer loan outstandings totalled
EUR 497 billion, compared with EUR 516 billion at 31
December 2022. At the same time, customer deposits amounted to EUR
618 billion, up by around +4% vs. 31 December 2022.
At 31 December 2023, the parent company had
issued a total of EUR 52.6 billion in medium/long-term debt. The
subsidiaries had issued EUR 5.4 billion. In all, the Group has
issued a total of EUR 58.0 billion in medium/long-term debt.
The Liquidity Coverage Ratio (LCR) was well
above regulatory requirements at 160% at end-December 2023 (an
average of 155% for the quarter), vs. 141% at end-December 2022. At
the same time, the Net Stable Funding Ratio (NSFR) stood at 119% at
end-December 2023 vs. 114% at end-December 2022.
The Group’s risk-weighted
assets (RWA) totalled EUR 388.8 billion at 31 December
2023 vs. EUR 362.4 billion at end-December 2022 according to
CRR2/CRD5 rules. RWAs in respect of credit risk account for 83.9%
of the total, i.e., EUR 326.2 billion, up by 7.8% vs. 31 December
2022.
At 31 December 2023, the Group’s Common
Equity Tier 1 ratio stood at 13.1%, or around 340 basis
points above the regulatory requirement of 9.77%12 at 31 December
2023. The Group’s ratio CET 1 ratio at 31 December 2023 includes a
+6 basis-point impact from the phasing of IFRS 9. Excluding this
impact, the fully-loaded ratio amounts to 13.1%. The Tier 1 ratio
stood at 15.6% at end-December 2023 (16.3% at end-December 2022),
while the total capital ratio amounted to 18.2% (19.4% at
end-December 2022), which is above the respective regulatory
requirements of 11.67%1 and 14.21%1.
The leverage ratio stood at
4.3% at 31 December 2023 (4.4% at end-December 2022), above the
regulatory requirement of 3.5%1.
With an RWA level of 31.9% and leverage exposure
of 8.7% at end-December 2023, the Group’s TLAC ratio is
significantly above the respective Financial Stability Board
requirements for 2023 of 22.1%1 and 6.75%1. Likewise, MREL-eligible
outstandings, which stood at 33.7% of RWA and 9.2% of leverage
exposure at end-December 2023, are also far above the respective
regulatory requirements of 25.72%1 and 5.91%1.
The Group is rated by four rating agencies: (i)
FitchRatings - long-term rating “A-”, positive outlook, 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) S&P Global
Ratings - long-term rating (senior preferred debt) “A”, stable
outlook, short-term rating
“A-1”.3. FRENCH RETAIL,
PRIVATE BANKING & INSURANCE
|
|
|
|
|
|
|
In EURm |
Q4 23 |
Q4 22 |
Change |
2023 |
2022 |
Change |
Net banking income |
1,953 |
2,279 |
-14.3% |
8,023 |
9,210 |
-12.9% |
Net banking income excl. PEL/CEL |
1,950 |
2,234 |
-12.7% |
8,019 |
9,018 |
-11.1% |
Operating expenses |
(1,672) |
(1,806) |
-7.4% |
(6,708) |
(6,896) |
-2.7% |
Gross operating income |
281 |
473 |
-40.6% |
1,315 |
2,314 |
-43.2% |
Net cost of risk |
(163) |
(219) |
-25.6% |
(505) |
(483) |
+4.6% |
Operating income |
118 |
254 |
-53.5% |
810 |
1,831 |
-55.8% |
Net profits or losses from other assets |
7 |
51 |
-86.3% |
10 |
57 |
-82.5% |
Reported Group net income |
92 |
229 |
-59.8% |
610 |
1,406 |
-56.6% |
RONE |
2.4% |
5.8% |
|
3.9% |
9.0% |
|
Cost to income |
85.6% |
79.2% |
|
83.6% |
74.9% |
|
SG Network, Private Banking and
Insurance
Average loans outstanding decreased by -1% vs.
Q3 23 (-5% vs. Q4 22) to EUR 201 billion amid a higher interest
rate environment compared with 2022. Outstanding loans to corporate
and professional clients excluding government-guaranteed PGE loans
rose by +1% vs. Q4 22. Home loan outstandings contracted by -2% vs.
Q4 22 in line with the Group’s selective lending policy implemented
in 2022 against the backdrop of negative margins. It is worth
noting that the origination business has resumed with improved
positive margins.
Average outstanding balance sheet deposits,
which include corporate and professional clients of the SG Network
at Private Banking and Insurance, were -1.8% lower vs. Q3 23 at EUR
234 billion, with a continued shift from sight deposits to
interest-bearing deposits. They contracted by -6% relative to
Q4 22 due mainly to the anticipated decrease at the start of
the year of corporate deposits amid rising interest rates.
As a result, the average loan/deposit ratio came
to 86% in Q4 23.
Private Banking activities,
which cover Private Banking activities in and outside of France,
posted record level of assets under management of EUR 143 billion
in Q4 23. In 2023, Private Banking’s net asset gathering pace (net
new money divided by AuM) rose by an average of +4% vs. 2022. Net
banking income for the quarter stood at EUR 355 million, an
increase of +1.4% vs. Q4 22, and at EUR 1,470 million for 2023, up
by +3.9% vs. 2022.
Insurance, which includes
activities in and outside of France, has been consolidated in the
French Retail, Private Banking & Insurance core business since
the second half of 2023.
Life insurance outstandings stood at EUR 136
billion at end-December 2023. The unit-linked share of 38% remains
at a high level and rose by +3 percentage points vs. December 2022.
Gross life insurance savings inflows amounted to EUR 3.5 billion in
Q4 23, up by +20% vs. Q4 22.
Protection insurance premiums rose by +4% vs. Q4
22, with good commercial momentum in property and casualty premiums
(+6% vs. Q4 22) that was notably driven by the performance in
France.
BoursoBank
BoursoBank posted a record quarter in terms of
onboarding with more than 566,000 new clients vs. Q4 22, while
reducing its acquisition costs per client. The number of clients at
the leading online bank in France reached 5.9 million at the end of
December 2023 on back of very strong organic growth over the year
(+1.2 million clients vs. 2022, up +26% vs. 2022).
At end-2023, the penetration rate for the French
market (i.e., the number of clients at BoursoBank divided by the
French population) stood at around 8.8%, up by +1.8 percentage
point vs. 2022. More specifically, around one French person out of
ten and one adult French person under 30 years old out of five is a
BoursoBank client.
At the same time, service costs are declining
(-10% vs. 2022, -27% vs. 2021). By leveraging its efficient model,
the cost base remains structurally low. This is illustrated by the
limited rise in BoursoBank’s headcount, which number of full-time
employees (FTEs) is around 940 in 2023.
As a result of a highly selective origination
policy on home loans amid a very unfavourable interest-rate
environment since mid-2022, average loan outstandings dipped by
-4.7% vs. 2022 to EUR 14.8 billion.
Average outstanding savings, including deposits
and financial savings, registered a sharp rise to EUR
55.6 billion at end 2023, up +13.6% vs. 2022. Deposits
increased by +17.3% vs. Q4 22, i.e., at a much faster rate than the
market trends. Life insurance outstandings increased by +2.4% vs.
Q4 22 to EUR 11.5 billion, with the unit-linked share accounting
for 44.2%, a +2.7 percentage-point rise vs. 2022.
Net banking
income
In Q4 23, revenues totalled EUR
1,953 million, down -14.3% vs. Q4 22, (-12.7% excluding PEL/CEL).
Net interest income excluding PEL/CEL was down -26% vs. Q4 22,
mainly due to the negative impact from short-term hedges taken
before the rise in interest rates. Fee income decreased by -2.7%
relative to Q4 22.
Over the year, revenues
totalled EUR 8,023 million, down -12.9% vs. 2022 (-11.1% restated
for the PEL/CEL provision). Net interest income excluding PEL/CEL
decreased by -22% vs. 2022 and fee income was stable.
Based on latest budget assumptions, the net
interest income forecast for French Retail, Private Banking and
Insurance for 2024 is expected to be greater than or equal to that
of 2022.
Operating
expenses
In Q4 23, operating expenses
came to EUR 1,672 million, down -7.4% vs. Q4 22. The cost-to-income
ratio stood at 85.6% in Q4 23.
Over the year, operating
expenses decreased by -2.7% vs. 2022 to EUR 6,708 million. The
cost-to-income ratio stood at 83.6%.
Cost of
risk
In Q4 23, the cost of risk
amounted to EUR 163 million or 27 basis points, which was lower
than in Q4 22 (35 basis points).
Over the year, the cost of risk
totalled EUR 505 million or 20 basis points, which is stable on the
2022 level.
Group net
income
In Q4 23, Group net income came
to EUR 92 million, down -60% vs. Q4 22. RONE stood at 2.4% in Q4
23.
Over 2023, Group net income
came to EUR 610 million, down -57% vs. 2022. RONE stood at
3.9 % in 2023.
-
GLOBAL BANKING AND INVESTOR SOLUTIONS
In EUR m |
Q4 23 |
Q4 22 |
Change |
2023 |
2022 |
Change |
Net banking income |
2,185 |
2,459 |
-11.1% |
-9.8%* |
9,640 |
10,108 |
-4.6% |
-3.4%* |
Operating expenses |
(1,599) |
(1,551) |
+3.1% |
+5.0%* |
(6,787) |
(6,832) |
-0.7% |
+0.5%* |
Gross operating income |
586 |
908 |
-35.5% |
-34.8%* |
2,853 |
3,276 |
-12.9% |
-11.6%* |
Net cost of risk |
(39) |
(78) |
-50.0% |
-47.7%* |
(30) |
(421) |
-92.9% |
-92.8%* |
Operating income |
547 |
830 |
-34.1% |
-33.6%* |
2,823 |
2,855 |
-1.1% |
+0.4%* |
Reported Group net income |
467 |
695 |
-32.8% |
-32.3%* |
2,280 |
2,293 |
-0.6% |
+1.0%* |
RONE |
12.3% |
16.2% |
+0.0% |
+0.0%* |
14.8% |
14.2% |
+0.0% |
+0.0%* |
Cost to income |
73.2% |
63.1% |
+0.0% |
+0.0%* |
70.4% |
67.6% |
+0.0% |
+0.0%* |
Net banking
income
Global Banking and Investor
Solutions delivered a solid performance in the fourth
quarter, posting revenues of EUR 2,185 million, down -11.1% with
respect to a strong Q4 22.
Over 2023, revenues remained
high, recording a slight decrease of -4.6% vs. a record 2022 (EUR
9,640 million in 2023 vs. EUR 10,108 million in 2022), notably
owing to less conducive market conditions than in 2022,
particularly for the fixed-income business.
Global Markets & Investor
Services recorded durably strong revenues of EUR 1,359
million in Q4 23, albeit -9.4% down on a high Q4 22 owing to an
unfavourable base effect following the EUR 91 million revaluation
in 2022 of the participation in Euroclear. Over 2023, revenues
totalled EUR 6,299 million, i.e., a -6.3% decrease vs. 2022.
Global Markets turned in a
mostly stable performance in Q4 23 vs. Q4 22 amid a normalising
market environment, posting revenues of EUR 1,215 million, slightly
down (-0.8%) vs. Q4 22, which was a record fourth quarter(13). In
2023, revenues were slightly down by -4.6% vs. 2022 to EUR 5,598
million, which is very good performance despite a less conducive
market context.
The Equities business performed
very well, posting near record fourth quarter revenues of EUR 765
million in Q4 23, up by +18.2% vs. Q4 22. The business was driven
by favourable market conditions in the equities markets and by
strong demand for derivatives. Over the year, revenues were
slightly down by-3.2% to EUR 3,196 million relative to robust
business activity in 2022.
Fixed Income and Currencies
recorded solid revenues of EUR 450 million, notably owing to solid
commercial momentum in the investment solutions business. They were
nonetheless down -22.1% vs. Q4 22, which ranks among the best
performing quarters for this business. Over 2023, revenues
decreased by -6.5% vs. 2022 to EUR 2,402 million.
Securities Services’ revenues
decreased by -47.6% over the quarter to EUR 144 million owing to a
positive one-off impact in Q4 22 of EUR 91 million following a
revaluation of the participation in Euroclear. Over 2023, revenues
contracted by -17.5% vs. 2022 and were stable (-0.7%) excluding the
impact of the valuation of various equity participations. Assets
under Custody and Assets under Administration amounted to EUR 4,931
billion and EUR 579 billion, respectively.
The Financing and Advisory
business posted revenues of EUR 826 million, down -13.9%
vs. Q4 22. In 2023, revenues contracted by a moderate -1.4% to EUR
3,341 million vs. 2022, which was a record year.
The Global Banking and Advisory business
registered solid revenues, albeit posting a -14.0% decrease
compared to the record quarter of Q4 22. The business notably
benefited from sustained commercial performance in the Asset
Finance and Natural Resources platforms. Strong momentum in
Asset-Backed Products in Q4 23 and Investment Banking confirmed its
rebound. Over 2023, durably high revenues decreased by -6.8% vs.
2022, which was a record year.
While robust, Global Transaction & Payment
Services’ revenues were down relative to 2022. Revenues decreased
by -13.5% vs. Q4 22 owing to the less favourable interest-rate
environment and to increased remuneration on deposits. Nonetheless,
2023 was a record year, with revenues up by a sharp +19.3% vs.
2022.
Operating
expenses
Operating expenses came to EUR 1,599
million in Q4 23 and included EUR 64 million in
transformation costs. Operating expenses were up by a
slight +3.1% vs. Q4 22, reflecting the tight rein on costs despite
an inflationary backdrop. Accordingly, the cost-to-income ratio
came to 73.2% in Q4 23.
Over 2023, operating expenses
decreased by a slight -0.7% vs. 2022. They include EUR 167 million
in transformation charges. The cost-to-income ratio for the year
consequently came to 70.4%. Excluding the contribution to the
Single Resolution Fund (SRF), the ratio was 65.4%.
Cost of
risk
In Q4 23, the cost of risk
remained at a very low 9 basis points (or EUR 39 million) vs. 16
basis points in Q4 22.
Over 2023, the cost of risk
stood at 2 basis points vs. 23 basis points in 2022.
Group net
income
In Q4 23, Group net income came
to EUR 467 million. It was EUR 2,280 million in
2023, down slightly by-0.6% vs. 2022.
For the quarter, Global Banking
and Investor Solutions reported RONE of 12.3%.
Over 2023, reported RONE came to 14.8% and to 17.2%
excluding the contribution to the SRF.
-
INTERNATIONAL RETAIL, MOBILITY AND LEASING
SERVICES
In EURm |
Q4 23 |
Q4 22 |
Change |
|
2023 |
2022 |
Change |
Net banking income |
2,015 |
2,111 |
-4.5% |
-10.1%* |
|
8,507 |
8,139 |
+4.5% |
+1.1%* |
Operating expenses |
(1,286) |
(1,017) |
+26.5% |
+0.4%* |
|
(4,765) |
(3,957) |
+20.4% |
+8.1%* |
Gross operating income |
729 |
1,094 |
-33.4% |
-19.8%* |
|
3,742 |
4,182 |
-10.5% |
-5.5%* |
Net cost of risk |
(137) |
(133) |
+3.0% |
-2.6%* |
|
(486) |
(705) |
-31.1% |
-8.8%* |
Operating income |
592 |
961 |
-38.4% |
-22.3%* |
|
3,256 |
3,477 |
-6.4% |
-5.1%* |
Net profits or losses from other assets |
(11) |
(1) |
n/s |
n/s |
|
(11) |
11 |
n/s |
n/s |
Reported Group net income |
281 |
526 |
-46.6% |
-33.9%* |
|
1,606 |
1,921 |
-16.4% |
-16.9%* |
RONE |
10.9% |
22.8% |
|
|
|
16.5% |
19.9% |
|
|
Cost to income |
63.8% |
48.2% |
|
|
|
56.0% |
48.6% |
|
|
International Retail Banking
posted a good commercial performance in 2023, recording loan
outstandings of EUR 67.3 billion and deposits of EUR 80.4 billion,
up by a respective +4.6% and +5.2% relative to 2022.
In Europe, outstanding loans continued their
uptrend and totalled EUR 41.9 billion at end-2023, which was a +
5.1% increase on 2022. Outstanding loans in the Czech Republic grew
by +3.4% vs. 2022, while in Romania they rose by +12.3% vs. 2022.
Outstanding deposits totalled EUR 53.3 billion at end-2023, up by
+7.5% vs. 2022.
Outstandings in Africa, Mediterranean Basin and
French Overseas Territories also grew, with loans of EUR 25.4
billion and deposits of EUR 27.1 billion in 2023, i.e., respective
increases of +3.7% and +0.8% vs. 2022. The region benefited from
particularly robust commercial performances in sub-Saharan Africa,
which posted loan outstandings growth of +6.8% vs. 2022, and in the
Mediterranean Basin which saw deposits increase by +4.5% vs.
2022.
Mobility and Leasing Services
registered solid growth in earning assets that was driven by the
increase in car values. In Q4 23, earning assets grew by +14.2% to
EUR 52.0 billion at end-December 2023 vs. EUR 45.5 billion at
end-December 2022. Consumer Finance entities recorded a good
performance at end-2023, with loan outstandings of EUR 24.1 billion
(+0.7% vs. 2022) and deposit outstandings of EUR 2.3 billion
(+17.5% vs. 2022). Equipment Finance business rode high on robust
production levels during the entire year to post outstandings of
EUR 15.4 billion at end-2023, up +2.8% vs. 2022.
Net banking
income
In Q4 23, the International
Retail, Mobility and Leasing Services core business posted revenues
of EUR 2,015 million, down -4.5% vs. Q4 22. Revenues were
notably impacted by a contraction in Ayvens despite the
contribution from LeasePlan as a result of the normalisation of
Used Car Sales (UCS) results, downward pressure on margins and
other exceptional items, notably the negative marked-to-market
value of the hedging portfolio (for around EUR -150 million).
Over 2023, revenues were up
+4.5% vs. 2022 to EUR 8,507 million, including ~EUR 680 million
from the integration of LeasePlan.
International Retail Banking’s
net banking income stood at EUR 1,067 million for the quarter, up
by +1.5% vs. Q4 22. Over 2023, revenues stabilised relative to 2022
at EUR 4,191 million.
Revenues in Europe remained high in 2023 at EUR
2,037 million and were stable vs. 2022. Romania turned in a good
financial performance in 2023 and posted a +12.4% increase in net
banking income vs. 2022. The Czech Republic recorded a lower net
interest margin compared with a particularly robust 2022 amid high
interest rates.
Revenues in Africa, Mediterranean Basin and
French Overseas Territories rose sharply over the year by +10.1%
vs. 2022 and were driven by robust growth in net interest income
across all regions (an average of +14.1% vs. 2022).
Mobility and Leasing Services’
revenues decreased by -10.6% over the quarter vs. Q4 22 to EUR 948
million in Q4 23, but were up by +9.3% over the year vs. 2022.
Ayvens posted net banking income down by -17% in Q4 23 vs. Q4 22,
and up by +16% in 2023 relative to 2022. The fourth quarter was
marked by downward pressure on margins resulting from the
interest-rate and inflationary environment. The Used Car Sales
(UCS) market began to progressively normalise in 2023, which
prompted a gradual decrease in UCS results. In Q4 23, Ayvens
registered an average UCS results of EUR 1,453 per unit vs. EUR
3,054 in Q4 22 at ALD (including the impact of the reduction in
depreciation costs, the average UCS result per unit stands at EUR
444 per car vs. EUR 1,919 in Q4 22) and a continued decrease in
prospective depreciation, with a ~EUR -130 million impact vs. Q4
22.At the same time, Ayvens recorded one-off items, notably the
negative marked-to-market value of its hedging portfolio on leasing
contracts for around EUR -150 million in Q4 23.Over the year, the
average UCS results (excluding the reduction of depreciation costs)
came to EUR 2,344 per unit, which remains high, relative to a
record year in 2022, at EUR 3,269 per unit.
2024 will be a pivotal year for Ayvens that will
include decisive steps in the LeasePlan integration and synergies
of around EUR 120 million that will materialise as of this year
(o/w EUR 38 million already secured), ahead of EUR 350 million in
2025, followed by approximately EUR 440 million in 2026. The amount
of associated restructuring costs for 2024 is confirmed at around
EUR 190 million, with a remaining amount of around EUR 40 million
in 2025.Regarding the business, Ayvens anticipates a gradual
improvement in margins in the future and an acceleration in the
normalisation of the UCS market. It has set the following targets
for 2024:
- Annual growth in earning assets of
+7% to +9% vs. 2023
- Average UCS result of EUR 1,100 to
EUR 1,600 per unit14
- Cost-to-income ratio of 65% to 67%
excluding UCS results non-recurring items and PPA15
In Q4 23, net banking income for consumer credit
businesses showed resilience, posting a slight decrease of -2.2%
vs. Q4 22. The Consumer Finance and Equipment Finance businesses
turned in a good financial performance, posting revenue increases
of +15.2% vs. Q4 22 and of +6.0% vs. 2022.
Operating
expenses
In Q4 23, operating expenses
came to EUR 1,286 million, by +26.5% vs. Q4 22 (stable at constant
perimeter and exchange rates). They were impacted by LeasePlan
costs of ~EUR 280 million and by transformation costs associated
with the integration of around EUR 56 million. The cost-to-income
ratio stood at 63.8% in Q4 23.
Over 2023, operating expenses
totalled EUR 4,765 million, up by +20.4% vs. 2022 (+8.1% at
constant perimeter and exchange rates). These included ~EUR 615
million from LeasePlan and ~EUR 250 million in transformation
costs.
International Retail’s
operating expenses were stable over the year at EUR 2,374 million.
Operating expenses rose by +2.6% to EUR 593 million in Q4 23 and
remained contained amid an inflationary context.
Operating expenses for Mobility and
Leasing Services totalled EUR 2,391 million, up by +50.5%
over the year (+8.1% vs. 2022 at constant perimeter and exchange
rates), including LeasePlan costs and transformation costs
associated with its integration.
Cost of
risk
In Q4 23, the cost of risk fell
to 33 basis points (or EUR 137 million) vs. 40 basis points in Q4
22.
Over 2023, the cost of risk
stood at 32 basis points vs. 52 basis points in 2022.
Group net
income
In Q4 23, Group net income came
to EUR 281 million, down -46.6% vs. Q4 22. RONE stood at 10.9% in
Q4 23. RONE was 18.2% in International Retail Banking, and
5.9% in Mobility and Leasing Services in Q4 23.
Over 2023, Group net income
came to EUR 1,606 million, down -16.4% vs. 2022, while RONE stood
at 16.5%. RONE was 17.5% in International Retail Banking, and 15.9%
in Mobility and Leasing Services in 2023.
-
CORPORATE CENTRE
In EURm |
Q4 23 |
Q4 22 |
2023 |
2022 |
Net banking income |
(196) |
(238) |
(1,066) |
(302) |
Operating expenses |
(109) |
(81) |
(264) |
(309) |
Gross operating income |
(305) |
(319) |
(1,330) |
(611) |
Net cost of risk |
(22) |
17 |
(4) |
(38) |
Net profits or losses from other assets |
(16) |
(60) |
(112) |
(3,364) |
Impairment losses on goodwill |
- |
- |
(338) |
- |
Income tax |
(46) |
(9) |
(126) |
382 |
Reported Group net income |
(410) |
(380) |
(2,003) |
(3,795) |
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 several costs incurred by the
Group that are not re-invoiced to the businesses.
Net banking
income
The Corporate Centre’s net banking
income totalled EUR -196 million in Q4 23 vs. EUR -238
million in Q4 22. It notably included the negative impact from
the unwinding of hedges on TLTRO operations for around EUR -30
million at Q4 23 and the impact of the decrease in long-term rates
on hedges not eligible for hedge accounting (around EUR -100
million).
Over the year, the Corporate Centre’s
net banking income totalled EUR -1,066 million vs. EUR
-302 million in 2022. It notably includes the negative impact
of replacement swaps for around EUR -310 million, the
unwinding of hedges on TLTRO operations for around EUR -330 million
and the negative impact of the year of one-off items for around EUR
-200 million.
Operating
expenses
Operating expenses totalled EUR -109
million in Q4 23 vs. EUR -81 million in Q4 22.
Over the year, operating expenses totalled
EUR -264 million vs. EUR -309 million in 2022.
Income tax
In Q4 23 the Group accounted for a provision for
deferred tax assets of around EUR 100 million.
Group net
income
The Corporate Centre’s net banking
income totalled EUR -410 million in Q4 23 vs. EUR -380
million in Q4 22.
Over the year, the Corporate Centre’s
net banking income totalled EUR -2,003 million vs. EUR
-3,795 million in 2022.
7. 2024 FINANCIAL
CALENDAR
2024 Financial communication calendar |
May 3, 2024 First quarter 2024
resultsMay 22, 2024 2023 General Meeting May 27, 2024 Dividend
detachmentMay 29, 2024 Dividend paymentAugust 1, 2024 Second
quarter and first half 2024 resultsOctober 31, 2024 Third quarter
and 9 month 2024 results |
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 Societe Generale Group.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 European Union, as well as the application of
existing prudential regulations.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 Societe Generale believes
that these statements are based on reasonable assumptions, these
forward-looking statements are subject to numerous risks and
uncertainties, including matters not yet known to it or its
management or not currently considered material, and there can be
no assurance that anticipated events will occur or that the
objectives set out will actually be achieved. Important factors
that could cause actual results to differ materially from the
results anticipated in the forward-looking statements include,
among others, overall trends in general economic activity and in
Societe Generale’s markets in particular, regulatory and prudential
changes, and the success of Societe Generale’s strategic, operating
and financial initiatives. 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, Societe Generale does not undertake any
obligation to update or revise any forward-looking information or
statements. Unless otherwise specified, the sources for the
business rankings and market positions are internal. |
8. APPENDIX 1: FINANCIAL
DATA
GROUP NET INCOME BY CORE
BUSINESS
In EURm |
Q4 23 |
Q4 22 |
Variation |
2023 |
2022 |
Variation |
French Retail, Private Banking and Insurance |
92 |
229 |
-59.8% |
610 |
1,406 |
-56.6% |
Global Banking and Investor Solutions |
467 |
695 |
-32.8% |
2,280 |
2,293 |
-0.6% |
International Retail, Mobility and Leasing Services |
281 |
526 |
-46.6% |
1,606 |
1,921 |
-16.4% |
Core Businesses |
840 |
1,450 |
-42.1% |
4,496 |
5,620 |
-20.0% |
Corporate Centre |
(410) |
(380) |
-7.9% |
(2,003) |
(3,795) |
+47.2% |
Group |
430 |
1,070 |
-59.8% |
2,493 |
1,825 |
+36.6% |
MAIN EXCEPTIONAL
ITEMS
In EURm |
Q4 23 |
Q4 22 |
2023 |
2022 |
Net Banking Income - Total exceptional items |
41 |
0 |
(199) |
0 |
One-off legacy items - Corporate Centre |
41 |
0 |
(199) |
0 |
|
Operating expenses - Total one-off items and transformation
charges |
(102) |
(221) |
(765) |
(767) |
Transformation charges |
(102) |
(221) |
(730) |
(767) |
Of which French Retail, Private Banking and Insurance |
18 |
(84) |
(312) |
(414) |
Of which Global Banking & Investor Solutions |
(64) |
(82) |
(167) |
(198) |
Of which International Retail, Mobility and Leasing Services |
(56) |
(55) |
(251) |
(155) |
One-off items |
0 |
0 |
(35) |
0 |
Of which French Retail, Private Banking and Insurance |
0 |
0 |
60 |
0 |
Of which Global Banking & Investor Solutions |
0 |
0 |
(95) |
0 |
|
Other one-off items - Total |
(116) |
(60) |
(820) |
(3,364) |
Net profits or losses from other assets |
(16) |
(60) |
(112) |
(3,364) |
Goodwill impairment - Corporate Centre(1) |
0 |
0 |
(338) |
0 |
Provision of Deferred Tax Assets - Corporate Centre(1) |
(100) |
0 |
(370) |
0 |
16
CONSOLIDATED BALANCE
SHEET
In EUR m |
|
31.12.2023 |
31.12.2022 R17 |
Cash, due from central banks |
|
223,048 |
207,013 |
Financial assets at fair value through profit or loss |
|
495,882 |
427,151 |
Hedging derivatives |
|
10,585 |
32,971 |
Financial assets at fair value through other comprehensive
income |
|
90,894 |
92,960 |
Securities at amortised cost |
|
28,147 |
26,143 |
Due from banks at amortised cost |
|
77,879 |
68,171 |
Customer loans at amortised cost |
|
485,449 |
506,635 |
Revaluation differences on portfolios hedged against interest rate
risk |
|
(433) |
(2,262) |
Insurance and reinsurance contracts assets |
|
459 |
353 |
Tax assets |
|
4,717 |
4,484 |
Other assets |
|
69,765 |
82,315 |
Non-current assets held for sale |
|
1,763 |
1,081 |
Investments accounted for using the equity method |
|
227 |
146 |
Tangible and intangible fixed assets |
|
60,714 |
33,958 |
Goodwill |
|
4,949 |
3,781 |
Total |
|
1,554,045 |
1,484,900 |
In EUR m |
|
31.12.2023 |
31.12.2022 R |
Due to central banks |
|
9,718 |
8,361 |
Financial liabilities at fair value through profit or loss |
|
375,584 |
304,175 |
Hedging derivatives |
|
18,708 |
46,164 |
Debt securities issued |
|
160,506 |
133,176 |
Due to banks |
|
117,847 |
133,011 |
Customer deposits |
|
541,677 |
530,764 |
Revaluation differences on portfolios hedgedagainst interest rate
risk |
|
(5,857) |
(9,659) |
Tax liabilities |
|
2,402 |
1,645 |
Other liabilities |
|
93,658 |
107,315 |
Non-current liabilities held for sale |
|
1,703 |
220 |
Insurance contracts related liabilities |
|
141,723 |
135,875 |
Provisions |
|
4,235 |
4,579 |
Subordinated debts |
|
15,894 |
15,948 |
Total liabilities |
|
1,477,798 |
1,411,574 |
Shareholder's equity |
|
- |
- |
Shareholders' equity, Group share |
|
- |
- |
Issued common stocks and capital reserves |
|
21,186 |
21,248 |
Other equity instruments |
|
8,924 |
9,136 |
Retained earnings |
|
32,891 |
33,816 |
Net income |
|
2,493 |
1,825 |
Sub-total |
|
65,494 |
66,025 |
Unrealised or deferred capital gains and losses |
|
481 |
945 |
Sub-total equity, Group share |
|
65,975 |
66,970 |
Non-controlling interests |
|
10,272 |
6,356 |
Total equity |
|
76,247 |
73,326 |
Total |
|
1,554,045 |
1,484,900 |
-
APPENDIX 2: METHODOLOGY
1 –The financial information presented
for the fourth quarter and the year 2023 was examined by the Board
of Directors on February 7th,
2023 and has been prepared in accordance with IFRS as
adopted in the European Union and applicable at that date. The
review procedures on the consolidated annual financial statements,
2023 carried by the Statutory Auditors are currently underway.
2 - Net banking income
The pillars’ net banking income is defined on
page 41 of Societe Generale’s 2023 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 notes 5 and 8.2 to the Group’s
consolidated financial statements as at December 31st, 2022. The
term “costs” is also used to refer to Operating Expenses. The
Cost/Income Ratio is defined on page 41 of Societe Generale’s 2023
Universal Registration Document.
4 - Cost of risk in basis points,
coverage ratio for doubtful outstandings
The cost of risk is defined on pages 42 and 691
of Societe Generale’s 2023 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 23 |
Q4 22 |
2023 |
2022 |
French Retail, Private Banking and Insurance |
Net Cost Of Risk |
163 |
219 |
505 |
483 |
Gross loan Outstandings |
240,533 |
250,175 |
246,701 |
246,249 |
Cost of Risk in bp |
27 |
35 |
20 |
20 |
Global Banking and Investor Solutions |
Net Cost Of Risk |
39 |
78 |
30 |
421 |
Gross loan Outstandings |
168,799 |
190,079 |
169,823 |
182,110 |
Cost of Risk in bp |
9 |
16 |
2 |
23 |
International Banking, Mobility and Leasing
Solutions |
Net Cost Of Risk |
137 |
133 |
486 |
705 |
Gross loan Outstandings |
164,965 |
133,756 |
150,161 |
135,743 |
Cost of Risk in bp |
33 |
40 |
32 |
52 |
Corporate Centre |
Net Cost Of Risk |
22 |
(17) |
4 |
38 |
Gross loan Outstandings |
23,075 |
16,363 |
20,291 |
15,411 |
Cost of Risk in bp |
40 |
(41) |
2 |
25 |
Societe Generale Group |
Net Cost Of Risk |
361 |
413 |
1,025 |
1,647 |
Gross loan Outstandings |
597,371 |
590,373 |
586,977 |
579,513 |
Cost of Risk in bp |
24 |
28 |
17 |
28 |
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”).
5 - 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 of Societe Generale’s 2023
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 43 of Societe
Generale’s 2023 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 (in EURm) |
Q4 23 |
Q4 22 |
2023 |
2022 |
Shareholders' equity Group share |
65,975 |
66,970 |
65,975 |
66,970 |
Deeply subordinated and undated subordinated notes |
(9,095) |
(10,017) |
(9,095) |
(10,017) |
Interest payable to holders of deeply & undated subordinated
notes, issue premium amortisation(1) |
(21) |
(24) |
(21) |
(24) |
OCI excluding conversion reserves |
636 |
780 |
636 |
780 |
Distribution provision(2) |
(995) |
(1,803) |
(995) |
(1,803) |
ROE equity end-of-period |
56,500 |
55,906 |
56,500 |
55,906 |
Average ROE equity |
56,607 |
55,953 |
56,396 |
55,282 |
Average Goodwill(3) |
(4,068) |
(3,660) |
(4,011) |
(3,650) |
Average Intangible Assets |
(3,188) |
(2,828) |
(3,143) |
(2,751) |
Average ROTE equity |
49,351 |
49,465 |
49,242 |
48,881 |
|
|
|
|
|
Group net Income |
430 |
1,070 |
2,493 |
1,825 |
Interest paid and payable to holders of deeply subordinated notes
and undated subordinated notes, issue premium amortisation |
(215) |
(192) |
(759) |
(596) |
Cancellation of goodwill impairment |
- |
- |
338 |
3 |
Ajusted Group net Income |
215 |
878 |
2,073 |
1,233 |
ROTE |
1.7% |
7.1% |
4.2% |
2.5% |
181920Average normative capital allocated
to core businesses
In EURm |
Q4 23 |
Q4 22 |
Change |
2023 |
2022 |
Change |
French Retail , Private Banking and Insurance |
15,439 |
15,867 |
-2.7% |
15,449 |
15,592 |
-0.9% |
Global Banking and Investor Solutions |
15,247 |
17,115 |
-10.9% |
15,426 |
16,176 |
-4.6% |
International Retail, Mobility and Leasing Services |
10,313 |
9,242 |
+11.6% |
9,707 |
9,670 |
+0.4% |
Core Businesses |
40,999 |
42,224 |
-2.9% |
40,582 |
41,438 |
-2.1% |
Corporate Center |
15,608 |
13,729 |
+12.9% |
15,814 |
13,844 |
+14.0% |
Group |
56,607 |
55,953 |
+1.0% |
56,396 |
55,282 |
+2.0% |
6 - Net assets and tangible net
assets
Net assets and tangible net assets are defined
in the methodology, page 45 of the Group’s 2023 Universal
Registration Document. The items used to calculate them are
presented below:
End of period (in EURm) |
2023 |
2022 |
2021 |
Shareholders' equity Group share |
65,975 |
66,970 |
65,067 |
Deeply subordinated and undated subordinated notes |
(9,095) |
(10,017) |
(8,003) |
Interest of deeply & undated subordinated notes, issue premium
amortisation(1) |
(21) |
(24) |
20 |
Book value of own shares in trading portfolio |
36 |
67 |
37 |
Net Asset Value |
56,895 |
56,996 |
57,121 |
Goodwill |
(4,008) |
(3,652) |
(3,624) |
Intangible Assets |
(2,954) |
(2,875) |
(2,733) |
Net Tangible Asset Value |
49,933 |
50,469 |
50,764 |
|
|
|
|
Number of shares used to calculate
NAPS(2) |
796,244 |
801,147 |
831,162 |
Net Asset Value per Share |
71.5 |
71.1 |
68.7 |
Net Tangible Asset Value per Share |
62.7 |
63.0 |
61.1 |
2122
7 - Calculation of Earnings Per Share
(EPS)
The EPS published by Societe Generale is
calculated according to the rules defined by the IAS 33 standard
(see page 44 of Societe Generale’s 2023 Universal Registration
Document). The corrections made to Group net income in order to
calculate EPS correspond to the restatements carried out for the
calculation of ROE and ROTE. The calculation of Earnings Per Share
is described in the following table:
Average number of shares (thousands) |
2023 |
2022 |
2021 |
Existing shares |
818,008 |
845,478 |
853,371 |
Deductions |
|
|
|
Shares allocated to cover stock option plans and free shares
awarded to staff |
6,802 |
6,252 |
3,861 |
Other own shares and treasury shares |
11,891 |
16,788 |
3,249 |
Number of shares used to calculate
EPS(1) |
799,315 |
822,437 |
846,261 |
Group net Income (in EUR m) |
2,493 |
1,825 |
5,641 |
Interest on deeply subordinated notes and undated subordinated
notes (in EUR m) |
(759) |
(596) |
(590) |
Adjusted Group net income (in EUR m) |
1,735 |
1,230 |
5,051 |
EPS (in EUR) |
2.17 |
1.50 |
5.97 |
23
8 - 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.
249 – Funded balance sheet, loan to
deposit ratio
The funded balance sheet is based on the Group
financial statements. It is obtained in two steps:
- A first step aiming at reclassifying
the items of the financial statements into aggregates allowing for
a more economic reading of the balance sheet. Main
reclassifications:
Insurance: grouping of the accounting items
related to insurance within a single aggregate in both assets and
liabilities.Customer loans: include outstanding loans with
customers (net of provisions and write-downs, including net lease
financing outstanding and transactions at fair value through profit
and loss); excludes financial assets reclassified under loans and
receivables in accordance with the conditions stipulated by IFRS 9
(these positions have been reclassified in their original
lines).Wholesale funding: Includes interbank liabilities and debt
securities issued. Financing transactions have been allocated to
medium/long-term resources and short-term resources based on the
maturity of outstanding, more or less than one
year.Reclassification under customer deposits of the share of
issues placed by French Retail Banking networks (recorded in
medium/long-term financing), and certain transactions carried out
with counterparties equivalent to customer deposits (previously
included in short term financing).Deduction from customer deposits
and reintegration into short-term financing of certain transactions
equivalent to market resources.
- A second step aiming at excluding
the contribution of insurance subsidiaries, and netting
derivatives, repurchase agreements, securities borrowing/lending,
accruals and “due to central banks”.
The Group loan/deposit ratio is
determined as the division of the customer loans by customer
deposits as presented in the funded balance sheet.
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.
Societe Generale
Societe Generale is a top tier European Bank
with 117,000 employees serving 25 million clients in more than 60
countries across the world. We have been supporting the development
of our economies for nearly 160 years, providing our corporate,
institutional, and individual clients with a wide array of
value-added advisory and financial solutions. Our long-lasting and
trusted relationships with the clients, our cutting-edge expertise,
our unique innovation, our ESG capabilities and leading franchises
are part of our DNA and serve our most essential objective - to
deliver sustainable value creation for all our stakeholders.
The Group runs three complementary sets of
businesses, embedding ESG offerings for all its clients:
- French
Retail Banking, with leading retail bank SG and insurance
franchise, premium private banking services, and the leading
digital Bank Boursorama.
- Global
Banking and Investor Solutions, a top tier wholesale bank
offering tailored-made solutions with distinctive global leadership
in Equity Derivatives, Structured Finance and ESG.
-
International Retail, Mobility & Leasing
Services, comprising well-established universal banks
(in Czech Republic, Romania and several African countries), and ALD
/ LeasePlan, a global player in sustainable mobility.
Committed to building together with its clients
a better and sustainable future, Societe Generale aims to be a
leading partner in the environmental transition and sustainability
overall. The Group is included in the principal socially
responsible investment indices: DJSI (Europe), FTSE4Good (Global
and Europe), Bloomberg Gender-Equality Index, Refinitiv Diversity
and Inclusion Index, Euronext Vigeo (Europe and Eurozone), STOXX
Global ESG Leaders indexes, and the MSCI Low Carbon Leaders Index
(World and Europe).
In case of doubt regarding the authenticity of
this press release, please go to the end of Societe Generale’s
newsroom page where official Press Releases sent by Societe
Generale can be certified using blockchain technology. A link will
allow you to check the document’s legitimacy directly on the web
page.
For more information, you can follow us on
Twitter @societegenerale or visit our website
societegenerale.com.
1 After restatement of operating expenses of
Russia in 2022 (EUR 145m) and those of LeasePlan (EUR 617m in 2023
and ~EUR 280m in Q4 23)2 Phased-in ratio 3 Consistent with
distribution policy disclosed during Capital Markets Day applicable
from 20234 Based on the number of shares in circulation at 31
December 2023, subject to usual approvals from the General Meeting
and the ECB5 Based on macro-economic assumptions detailed on slide
37 of the Group’s fourth quarter and full year resultsNB: 2022 data
in this document are restated in compliance with IFRS17 and IFRS9
for insurance entities6 Average annual revenue growth between 0%
and 2% over 2022-2026Asterisks* in the document refer to data at
constant perimeter and exchange rate7 Ratio calculated according to
EBA methodology published on 16 July 20198 Ratio of S3 provisions
and guarantees/collateral to gross book value of NPL9 Based on the
number of shares in circulation at 31 December 2023, subject to
usual approvals from the General Meeting and the ECB10 In line with
the IAI/MPP 1.5°C scenario11 Based on a Poseidon Principles
alignment score of 15% in 2030 relative to the IMO’s “Striving For”
scenario. Excluding cruise ships at the present time, until the
carbon intensity indicator is modified to take into account its
specific features12 From 2 January 2024, the new regulatory
requirements will be as follows: 10.22% for the CET 1 ratio, 12.14%
for the Tier 1 ratio, 14.71 % for the total solvency ratio, 3.6%
for the leverage ratio, 27.24% and 6.08% respectively for the MREL
RWA and leverage exposure ratios, 22.29% and 6.75 %, respectively,
for the TLAC RWA and leverage exposure ratios 13 At
comparable business model in the post Global Financial Crisis (GFC)
regulatory regime14 Excluding prospective depreciation and PPA15
Cost to income ratio at ~70% reported at SG level16 Items restated
from reported net income for the proposed distribution17 Balance
sheet restated in compliance with IFRS17 and IFRS9 for insurance
entities18 Interest net of tax19 Based on the 2023 proposed
distribution, subject to usual approvals of the General Meeting and
the ECB20 Excluding goodwill arising from non-controlling
interests21 Interest net of tax22 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.23 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.
- Societe-Generale-2023-Financial-results-press-release-en
Societe Generale (EU:GLE)
Gráfica de Acción Histórica
De Abr 2024 a May 2024
Societe Generale (EU:GLE)
Gráfica de Acción Histórica
De May 2023 a May 2024