Foreign lesion

4 May 2017 By George Hay Follow @gfhay

Strong first-quarter growth in BNP Paribas and SocGen’s foreign markets offset weaker showings at home. Still, SocGen’s 963 mln euro Libyan settlement shows how overseas adventures can go awry. And if Sunday’s election delivers a surprise, French banks face redenomination risk.

This content is for Subscribers only

To access full Breakingviews.com content you must be a subscriber. Please use the following link to request a trial.

Subjects

Regions

Context News

Societe Generale announced earnings of 747 million euros on May 4, down 19 percent year on year compared to the first quarter of 2016. It took a 350 million euro provision to settle a dispute with the Libyan Investment Authority.

The dispute involved allegations that trades were secured as part of a "fraudulent and corrupt scheme" involving the payment of $58.5 million by SocGen to a Panamanian-registered company.

The case, which had been expected to go to trial on May 4 and run until the end of July, was due to focus on five trades totalling $2.1 billion, executed between 2007 and 2009, before Colonel Muammar Gaddafi was ousted as Libyan leader. A spokeswoman for SocGen in Paris said the bank was paying 963 million euros as part of the settlement.

Stripping out the 350 million euro provision, SocGen recorded a return on equity of 10.5 percent, compared to 7.1 percent in the first quarter of 2016.

As of 1030 BST on May 4, SocGen shares were trading at 51.16 euros, down 0.5 percent.

BNP Paribas on May 3 announced pre-tax profit of 2.7 billion euros, up 4.4 percent year on year compared to the first quarter of 2016. On May 3, BNP shares closed up 0.6 percent at 66.2 euros.

Search the Archive

Foreign lesion

This content is for Subscribers only

Email a friend

Please complete the form below.

Foreign lesion

This content is for Subscribers only

Existing Users Log In

Email a friend

Please complete the form below.