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17 January 2019 By Christopher Thompson Follow @CGAThompson

The French group blamed market volatility for a one-fifth drop in trading revenue in the fourth quarter. A flat dividend paid partly in shares hints at further capital headwinds. Investors who attach a discount to lenders with large capital market arms will feel justified.

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French bank Société Générale said on Jan. 17 that its fourth-quarter results would be impacted by challenging market conditions and some asset sales.

"The challenging market environment in global capital markets is expected to result in a decline in Global Markets and Investor Services revenues of approximately 20 percent in Q4 18 versus Q4 17 and of approximately 10 percent in 2018 vs. 2017, as well as a significant increase in market risk weighted assets," SocGen said in a statement.

The lender added that it proposed to maintain the same dividend as last year, at 2.20 euros per share, and offer shareholders the possibility of taking the payout in shares.

SocGen said it expected its pro-forma common equity Tier 1 capital ratio to be between 11.4 and 11.6 percent.

SocGen shares were down 3 percent at 29.29 euros by 0900 GMT on Jan. 17.

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