Encore une fois

7 May 2013 By Dominic Elliott

The French bank has found another 900 mln euros of flab to work off after shifting 550 mln in the last year. For some institutions, that might look like despair. But Societe Generale’s Q1 results outdid those of bigger rival BNP Paribas, implying room for shares to rise.

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Societe Generale said on May 7 that it was planning to cut 900 million euros in costs over the next three years as it announced its first quarter results. The new savings follow a 550 million euro reduction in expenses last year and will help the banking group achieve a new return on equity target of 10 percent.
Excluding one-off items, SocGen’s RoE was 7.4 percent for the quarter. Together, the total of 1.45 billion euros of cuts will cost 600 million euros to implement, the bank said. Societe Generale’s core Tier 1 ratio under Basel III stood at 8.7 percent at the end of the first quarter. The bank aims to raise this to close to 9.5 percent by the end of this year.

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