Understanding our third quarter 2021 results

Dear shareholders, 

In line with the first half of the year, Societe Generale has again published excellent results in the third quarter, with strong commercial and financial performances in all the businesses. 

As a result, our Q3 revenues were up by nearly 15% vs. Q3 2020, driven by very strong growth in Financial Services and Financing & Advisory, a very good performance by Global Markets, and the continued growth in all our Retail Banking activities, in France and internationally. This substantial increase in revenues combined with our continued discipline on costs has resulted in a significant rise in underlying gross operating income of nearly 33%. The Group also continued to benefit from the quality of its loan portfolio, with a low cost of risk, while pursuing a very prudent provisioning policy. Underlying Group net income totalled EUR 1.4 billion in Q3 21 (EUR 1.6 billion on a reported basis) and EUR 4 billion for 9M 21. As a result, our return on equity stood at the very satisfactory level of 10.9% in Q3 21 and 10.4% in 9M 21 (underlying ROTE).

Our capital position remains very robust, well above the regulatory requirement. Our distribution policy is also attractive. We are therefore launching a share buyback programme, for an amount of around EUR 470 million, which is expected to be implemented between November 4th and the end of the year. It will lead to an increase in earnings per share from 2022. At the end of the first 9 months of the year, we have also included a provision for distribution, which finances dividend and share buyback, amounting to EUR 2.03 per share in accordance with our distribution policy of 50% of underlying Group net income.

This quarter, we continued to implement the strategic initiatives announced during the last few months. Accordingly, on October 12th, we presented the model and detailed organisational structure of our new French retail bank resulting from the project to merge our Societe Generale and Crédit du Nord networks. This project will give rise to a new French retail bank, with a commercially proactive and more efficient model, serving 10 million customers. We are progressing in line with the commitments and timetable presented in December 2020. Therefore, we will not leave any of the towns and cities in which we are located, and the associated job cuts will be made without any compulsory departures and by giving priority to internal mobility, in accordance with our responsible employer policy. As for our online bank, Boursorama, it continues to expand and has exceeded 3 million clients ahead of its onboarding plan. Global Banking & Investor Solutions is progressing in accordance with its roadmap announced in May, with substantially higher earnings, evidence of effective capital reallocation and improved operational efficiency.

We are confidently looking to the future and preparing our new strategic plan 2022-2025. We will draw on our innovative and fast-growing businesses and our recognised leadership in terms of corporate social responsibility. 

I would like to thank you again for your loyalty and the trust you have placed in our Group as well as your long-term commitment alongside us.

Frédéric Oudéa
Chief Executive Officer