Societe Generale maintains targets after Q1 profit beat

3rd May 2024 08:48

(Sharecast News) - Shares in French banking giant Société Générale surged on Friday after the company reiterated its full-year guidance despite a sharp drop in profits in the first quarter as it beat consensus estimates.

The lender reported a net income of €680m for the first three months of the year, down 22% on a reported basis from the year before, mainly as a result of a loss on the disposal of assets in Morocco and an increase in the cost of risk which covers the cost of doubtful loans.

Nevertheless, quarterly revenues were down just 0.4% year-on-year at €6.6bn.

According to consensus forecasts, the bank was expected to report a net income of €476m and revenues of €6.4bn. The reason for the profit beat was thought to be a 26% jump in profits at the Global Banking and Investor Solutions division.

Société Générale reported a return on tangible equity of 4.1% for the first quarter, down from 5.7% in the comparative period last year. However, the bank said it continues to expect to report a ROTE of more than 6% for the whole year, compared with 4.2% for 2023.

The stock was up 4.5% at €26.96 by 0955 in Paris.