Societe Generale loses more than one billion euros in the second quarter

Societe Generale loses more than one billion euros in the second quarter


The Société Générale banking group suffered a net loss of more than one billion euros in the second quarter, as a result of an increase in its provisions for credit risks and exceptional effects linked to the Covid-19 crisis.

According to the results published on Monday, the loss amounted to 1.26 billion euros (1.34 billion francs), compared with a profit of just over one billion over the same period in 2019.

The publication of Societe Generale for the second quarter comes after that of BNP Paribas, which had for its part unveiled Friday a net profit certainly in decline, but reaching 2.3 billion euros.

“This quarter was strongly impacted by the global health crisis of Covid-19 and its economic repercussions”, and this despite a noted restart of activity “since mid-May”, underlines Société Générale in its press release.

Economic crisis obliges, the commercial activity was strongly slowed down between April and the end of June: the net banking income, equivalent more or less to the turnover, plummeted by almost 16% to 5.3 billion euros. The slowdown affected most of the group’s major businesses, with the notable exception of asset management and private banking, as well as financing and advisory activities.

Above all, the bank with the red and black logo has, like most other players in the sector, considerably increased its provisions to deal with possible credit accidents, which have not yet been proven but likely to occur in the event of a deterioration in the economy. . These reserves amounted to 653 million euros.

In this context, the cost of risk, the indicator that measures the overall evolution of provisions, quadrupled, from 314 million euros in the second quarter of 2019 to almost 1.3 billion over the same period in 2020.

The group has also recorded in its accounts two large depreciations: one of nearly 700 million euros mainly concerns certain market assets, and the other, 650 million, is linked to the effects of the crisis on certain reductions. taxes that the bank could benefit from in the future.

By erasing the various exceptional effects, the group explains ending the second quarter with a profit of 70 million euros, against 1.35 billion a year earlier.


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