Understanding our Annual Results 2022

Dear Shareholders, 

2022 marked a decisive stage for the Group, which was able to deliver record underlying performances while adapting itself swiftly and efficiently to an uncertain and complex environment. Throughout the year, the Group made major strategic progress that has unlocked value.

As was the case in 2021, our businesses again turned in excellent performances in 2022, generating record revenue growth of +9.3%¹. These performances were driven by historical highs in Financing & Advisory, Global Markets and ALD, as well as by sharp growth in Private Banking and International Retail Banking, and a solid performance by French Retail Banking. In addition, the Group kept costs firmly under control, ensuring the continued improvement of the cost to income ratio in 2022 to 61.0%¹ vs. 64.4%¹ in 2021. At the same time, the quality of the credit portfolio contained the cost of risk during the year (28 basis points of risk exposure), which is lower than the annual guidance given at the start of 2022. The metric is composed of a low level of loan defaults (17 basis points) despite the impact of the Ukraine crisis, and complementary statistical provisions in line with the Group’s continued prudent provisioning (11 basis points).

Over the full year, underlying Group net income stood at EUR 5.6 billion¹ and profitability at EUR 9.6%¹. Group net income totalled EUR 2.0 billion on a reported basis, which notably includes the accounting impact of the disposal of our Russian activities during the year (around EUR 3.3 billion before tax).

Considering the strong financial performance in 2022 and an exceptional year, the Board of Directors decided to propose a distribution policy that ensures on one hand a fair remuneration of shareholders, and on the other hand, further strengthens the Group CET1 ratio. The distribution corresponds to EUR 1.8 billion, i.e., equivalent to EUR 2.25 per share². A cash dividend of EUR 1.70 will be proposed at the General Meeting of Shareholders on 23 May 2023. The dividend will be detached on 30 May 2023 and paid out on 1 June 2023. The Group is also planning to launch a share buyback programme for a total of around EUR 440 million, i.e., the equivalent of EUR 0.55 per share. The rollout of the programme is conditional on receiving the usual clearances from the ECB.

2022 was also marked by major strategic achievements that will unlock value in future. First and foremost, we carried out – on schedule – the legal merger of our Societe Generale and Crédit du Nord networks in France on 1 January 2023 and launched our new retail bank in France named SG. We also accelerated business growth at Boursorama, adding 1.4 million new clients in 2022, including those who were onboarded following the agreement signed with ING. Through the acquisition of LeasePlan by ALD and the planned Bernstein joint venture deal we are also moving forward to create global leaders in sustainable mobility and the Equity businesses. 

In addition to our major achievements resulting from the strategic initiatives we rolled out in all our businesses, we also defined the Group’s new CSR ambitions with the aim of supporting our clients in responsible energy transition. For example, the Group upscaled its ESG actions and commitments by deploying an ESG culture throughout all our activities. We also strengthened our ambitions with regard to decarbonising our business portfolios and in favour of biodiversity.
Last, we naturally continued to pursue digital transformation initiatives and improve our operational efficiency throughout 2022.

After this intense, demanding but very successful 2022, we are embarking with determination on 2023, a year of transition in many respects. 2023 will be a transition year with a change in Senior Management that will take place after the General Meeting in May. A transition year, also, in terms of our financial performances, as we will again be impacted by the specific unfavourable functioning of the French retail banking market and we will make our final contribution to the European Single Resolution Fund, which has weighed heavily on our finances. That said, we are very confident about the rebound that we expect to occur as of 2024 and notably the benefit of the link-up of our two retail banking networks in France. Building on the commercial momentum of the businesses and the strength of the balance sheet, the Group is confident of being able to reap the benefit of ongoing projects and confirms its financial guidance for 2025. 

I wish to thank you once again for the loyalty and trust you have placed in our Group, and for your long-term commitment by our side. 
 
Frédéric Oudéa
Chief Executive Officer

¹ Underlying data excluding contribution to the Single Resolution Fund
² Based on the number of shares in circulation at 31/12/2022 and subject to usual approval from the General Meeting and the ECB