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Societe Generale: Third quarter 2021 earnings

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·45-min read
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RESULTS AT SEPTEMBER 30TH 2021

Press release
Paris, November 4th 2021,

Q3 21: EXCELLENT QUARTER, UNDERLYING GROUP NET INCOME OF EUR 1.4 BILLION(1) (EUR 1.6 BILLION ON A REPORTED BASIS)

Revenues up +14.9% vs. Q3 20 (+15.0%*) driven by growth in all the businesses, in particular a very strong momentum in Financial Services and Financing & Advisory, a very good performance by Global Markets, and continued growth in Retail Banking

Underlying gross operating income: EUR 2.4 billion(1), up 32.8%(1) vs. Q3 20, with a positive jaws effect

Still low cost of risk: 15 basis points in Q3 21, with no significant provision write-back

Profitability (ROTE): 10.9%(1) on an underlying basis and 12.7% on a reported basis in
Q3 21

9M 21: UNDERLYING GROUP NET INCOME OF EUR 4.0 BILLION(1) (X5 VS.
9M 20)

Underlying gross operating income: EUR 6.6 billion(1), +61% vs. 9M 20, driven by revenue growth combined with continued good cost discipline

Cost of risk: 16 basis points

Profitability (ROTE): 10.4%(1) on an underlying basis and 10.0% on a reported basis in
9M 21

SOLID CAPITAL POSITION

Solid CET 1 ratio: 13.4%2(2) at end-September 2021, after provision for distribution and including the impact of the share buyback programme, or around 440 basis points above the regulatory requirement

Organic capital generation: 61 basis points in the first 9 months of 2021

Attractive shareholder return

  • Launch of the share buyback programme, for an amount of around EUR 470 million, scheduled for November 4th, with the programme expected to be finalised by end-2021

  • Provision for distribution per share of EUR 2.03 in 9M 21 (financing both dividend and share buyback) consistent with a payout ratio of 50% of underlying Group net income3(3)

SUCCESSFUL EXECUTION OF OUR STRATEGIC PROJECTS
Detailed presentation of the new French Retail Banking operation (a full merger project progressing as scheduled)
Very satisfactory implementation of the strategy in Global Banking & Investor Solutions
Development of our differentiating assets (Boursorama, ALD, KB)

Frédéric Oudéa, the Group’s Chief Executive Officer, commented:
The Societe Generale group enjoyed an excellent quarter, with strong commercial and financial performances in all the businesses and improvement of the cost-income ratio. The group also continued to benefit from the quality of its loan portfolio, with a low cost of risk combined with a continued very prudent provisioning policy. Thanks to the unfailing commitment of the teams, the different strategic projects announced, in particular the creation of a new French Retail Bank resulting from the merger of the Societe Generale and Crédit du Nord networks, are all progressing in line with the objectives set. The group is already starting to prepare its new strategic plan 2022-2025, drawing on its strong, innovative and fast-growing businesses and its recognised leadership in terms of corporate social responsibility.

  1. GROUP CONSOLIDATED RESULTS

In EURm

Q3 21

Q3 20

Change

9M 21

9M 20

Change

Net banking income

6,672

5,809

+14.9%

+15.0%*

19,178

16,275

+17.8%

+20.0%*

Operating expenses

(4,170)

(3,825)

+9.0%

+9.0%*

(13,025)

(12,363)

+5.4%

+6.6%*

Underlying operating expenses(1)

(4,272)

(4,002)

+6.8%

+6.7%*

(12,594)

(12,186)

+3.3%

+4.6%*

Gross operating income

2,502

1,984

+26.1%

+26.7%*

6,153

3,912

+57.3%

+63.4%*

Underlying gross operating income(1)

2,400

1,807

+32.8%

+33.5%*

6,584

4,089

+61.0%

+67.0%*

Net cost of risk

(196)

(518)

-62.2%

-62.4%*

(614)

(2,617)

-76.5%

-76.0%*

Operating income

2,306

1,466

+57.3%

+58.7%*

5,539

1,295

x 4.3

x 4.6*

Underlying operating income(1)

2,204

1,289

+70.9%

+72.7%*

5,970

1,472

x 4.1

x 4.3*

Net profits or losses from other assets

175

(2)

n/s

n/s

186

82

x 2.3

x 2.3*

Impairment losses on goodwill

-

-

n/s

n/s

-

(684)

n/s

n/s

Income tax

(699)

(467)

+49.7%

+50.9%*

(1,386)

(1,079)

+28.4%

+31.4%*

Net income

1,781

992

+79.5%

+80.9%*

4,343

(386)

n/s

n/s

O.w. non-controlling interests

(180)

(130)

+38.5%

+38.7%*

(489)

(342)

+43.0%

+43.5%*

Reported Group net income

1,601

862

+85.7%

+87.3%*

3,854

(728)

n/s

n/s

Underlying Group net income(1)

1,391

742

+87.4%

+89.3%*

4,038

803

x 5.0

x 5.5*

ROE

11.1%

5.7%

8.7%

-3.0%

ROTE

12.7%

6.5%

10.0%

-1.4%

Underlying ROTE(1)

10.9%

5.5%

10.4%

1.0%

(1) Adjusted for exceptional items and linearisation of IFRIC 21

Societe Generale’s Board of Directors, which met on November 3rd, 2021 under the chairmanship of Lorenzo Bini Smaghi, examined the Societe Generale Group’s results for Q3 and 9M 2021.

The various restatements enabling the transition from underlying data to published data are presented in the methodology notes (section 10.5).

Net banking income
Net banking income increased by +14.9% (+15.0%*) vs. Q3 20, driven by a very strong momentum in all the businesses and the beginning of the recognition of the second TLTRO allowance for around EUR 0.1 billion.

French Retail Banking continued the progress initiated for several quarters. As a result, net banking income (excluding PEL/CEL provision) increased by +5.7% vs. Q3 20, driven by the recovery in net interest income and commissions.

International Retail Banking & Financial Services enjoyed strong revenue growth (+12.8%* vs.
Q3 20), driven by the excellent momentum in Financial Services to Corporates (+39.9%* vs. Q3 20) and Insurance (+10.2%* vs. Q3 20). International Retail Banking also continued to progress (+4.0%* vs. Q3 20).

Global Banking & Investor Solutions also turned in an excellent performance, with revenues up +16.1% vs. Q3 20. Financing & Advisory enjoyed very strong growth (+30.7% vs. Q3 20) while Global Markets activity remained robust (+8.4% vs. Q3 20).

In 9M 21, the Group posted strong growth of +17.8% (+20.0%*) vs. 9M 20, with a positive contribution from all the businesses, and returned to a higher revenue level than in 9M 19 (EUR 18.5 billion).

Operating expenses
In Q3 21, operating expenses totalled EUR 4,170 million on a reported basis and EUR 4,272 million on an underlying basis (restated for the linearisation of IFRIC 21 and transformation costs amounting to EUR 97 million), representing an increase of +6.8% vs. Q3 20.

Driven by a positive jaws effect, underlying gross operating income rose +32.8% to EUR 2,400 million and the underlying cost to income ratio improved by nearly 5 points (64% vs. 69% in Q3 20).

In 9M 21, costs amounted to EUR 13,025 million on a reported basis and EUR 12,594 million on an underlying basis, up +3.3% vs. 9M 20. This limited growth can be explained by the rise in variable costs linked to the growth in revenues (EUR +595 million) and the increase in the IFRIC 21 charge (EUR +67 million). The other operating expenses declined by EUR 207 million, excluding structure effect.

Cost of risk

In Q3 21, the commercial cost of risk stood at a low level of 15 basis points, or EUR 196 million, lower than in Q3 20 (40 basis points) and slightly higher than in Q2 21 (11 basis points). It breaks down into a provision on non-performing loans of EUR 266 million and a provision write-back on performing loans of EUR 70 million.

The Group’s provisions on performing loans currently amount to EUR 3,486 million.

As part of the support provided to its customers during the crisis, the Group granted State Guaranteed Loans. At September 30th 2021, the residual amount of State Guaranteed Loans represented around EUR 17 billion. In France, the total amount of State Guaranteed Loans (“PGE”) amounts to around
EUR 15 billion and net exposure is less than EUR 2 billion.

The gross doubtful outstandings ratio amounted to 3.1%4(1) at September 30th 2021, stable vs. end-June 2021. The Group’s gross coverage ratio for doubtful outstandings also remained stable at 52%5(2) at September 30th 2021 vs. June 30th 2021.

The cost of risk is not expected to exceed 20 basis points in 2021.

Group net income

In EURm

Q3 21

Q3 20

9M 21

9M 20

Reported Group net income

1,601

862

3,854

(728)

Underlying Group net income6(1)

1,391

742

4,038

803

In %

Q3 21

Q3 20

9M 21

9M 20

ROTE

12.7%

6.5%

10.0%

-1.4%

Underlying ROTE(1)

10.9%

5.5%

10.4%

1.0%

Earnings per share amounts to EUR 4.02 in 9M 21 (EUR -1.38 in 9M 20). Underlying earnings per share amounts to EUR 4.06 over the same period (EUR 0.42 in 9M 20).

  1. THE GROUP’S FINANCIAL STRUCTURE

Group shareholders’ equity totalled EUR 63.6 billion at September 30th, 2021 (EUR 61.7 billion at December 31st, 2020). Net asset value per share was EUR 65.5 and tangible net asset value per share was EUR 57.8.

The consolidated balance sheet totalled EUR 1,526 billion at September 30th, 2021 (EUR 1,462 billion at December 31st, 2020). The net amount of customer loan outstandings at September 30th, 2021, including lease financing, was EUR 468 billion (EUR 440 billion at December 31st, 2020) – excluding assets and securities purchased under resale agreements. At the same time, customer deposits amounted to EUR 487 billion, vs. EUR 451 billion at December 31st, 2020 (excluding assets and securities sold under repurchase agreements).

At October 20th, 2021, the parent company had issued EUR 31.5 billion of medium/long-term debt, having an average maturity of 5.4 years and an average spread of 38 basis points (vs. the 6-month midswap, excluding subordinated debt). The subsidiaries had issued EUR 1.4 billion. In total, the Group had issued EUR 32.9 billion of medium/long-term debt. As a result, the parent company had completed its 2021 annual financing programme on both vanilla debt and structured issuances.

The LCR (Liquidity Coverage Ratio) was well above regulatory requirements at 130% at end-September 2021, vs. 149% at end-December 2020. At the same time, the NSFR (Net Stable Funding Ratio) was at a level of 105% at end-September 2021, above the regulatory requirement of 100%.

The Group’s risk-weighted assets (RWA), including IFRS9 phasing, amounted to EUR 363.5 billion at September 30th, 2021 (vs. EUR 351.9 billion at end-December 2020) according to CRR2/CRD5 rules. Risk-weighted assets in respect of credit risk represent 82.5% of the total, at EUR 300.0 billion, up 4.4% vs. December 31st, 2020.

At September 30th, 2021, the Group’s Common Equity Tier 1 ratio stood at 13.4%, or around 440 basis points above the regulatory requirement. The CET1 ratio at September 30th, 2021 includes an effect of +19 basis points for phasing of the IFRS 9 impact. Excluding this effect, the fully-loaded ratio amounts to 13.2%. The Tier 1 ratio stood at 15.6% at end-September 2021 (16% at end-December 2020) and the total capital ratio amounted to 18.6% (19.2% at end-December 2020).

The leverage ratio stood at 4.5% at September 30th, 2021 (4.8% at end-December 2020).

With a level of 29.9% of RWA and 8.6% of leverage exposure at end-September 2021, the Group’s TLAC ratio is above the FSB’s requirements for 2021 and 2022. At September 30th, 2021, the Group was also above its 2022 MREL requirements of 25.2% of RWA and 5.91% of leverage exposure.

The Group is rated by four rating agencies: (i) Fitch Ratings - long-term rating “A-”, stable rating, senior preferred debt rating “A”, short-term rating “F1” (ii) Moody’s - long-term rating (senior preferred debt) “A1”, stable outlook, short-term rating “P-1” (iii) R&I - long-term rating (senior preferred debt) “A”, stable outlook; and (iv) S&P Global Ratings - long-term rating (senior preferred debt) “A”, stable outlook, short-term rating “A-1”.

  1. FRENCH RETAIL BANKING

In EURm

Q3 21

Q3 20

Change

9M 21

9M 20

Change

Net banking income

1,976

1,836

+7.6%

5,729

5,470

+4.7%

Net banking income excl. PEL/CEL

1,963

1,857

+5.7%

5,711

5,511

+3.6%

Operating expenses

(1,351)

(1,292)

+4.6%

(4,101)

(3,975)

+3.2%

Gross operating income

625

544

+14.9%

1,628

1,495

+8.9%

Gross operating income excl. PEL/CEL

612

565

+8.3%

1,610

1,536

+4.8%

Net cost of risk

5

(130)

-103.8%

(124)

(821)

-84.9%

Operating income

630

414

+52.2%

1,504

674

x 2.2

Net profits or losses from other assets

(2)

3

-166.7%

2

139

-98.6%

Reported Group net income

451

283

+59.4%

1,092

562

+94.3%

Underlying Group net income (1)

414

274

+50.9%

1,107

613

+80.6%

RONE

16.4%

9.5%

13.0%

6.5%

Underlying RONE(1)

15.0%

9.2%

13.2%

7.1%

(1) Adjusted for the linearisation of IFRIC 21 and PEL/CEL provision

Societe Generale and Crédit du Nord networks:

Average loan outstandings were 2% lower than in Q3 20 at EUR 207 billion. They were 9% higher than in Q3 19. Average outstanding loans to individuals were up +1%, bolstered by the growth in home loan production (+58% vs. Q3 20). The production of medium/long-term loans to corporate and professional customers climbed +48% excluding State Guaranteed Loans vs. Q3 20.

Average outstanding balance sheet deposits7(2) increased by +7% vs. Q3 20 to EUR 240 billion, still driven by sight deposits, whose rate of growth nevertheless decelerated.

As a result, the average loan/deposit ratio stood at 87% in Q3 21 vs. 95% in Q3 20.

Insurance assets under management totalled EUR 91 billion at end-September 2021. Gross life insurance inflow amounted to EUR 1.9 billion in Q3 21, with the unit-linked share accounting for 36%.

Private Banking’s assets under management totalled EUR 76 billion at end-September 2021. Net inflow remained buoyant at EUR 1.1 billion in Q3 21.

Property/casualty insurance premiums were up +3% vs. Q3 20, as were personal protection insurance premiums (+3% vs. Q3 20).

Boursorama:

The bank consolidated its position as the leading online bank in France, with more than 3.1 million clients at end-September 2021, thanks to the onboarding of 163,000 new clients in Q3 21 (+26% vs. Q3 20). Boursorama has exceeded 3 million clients ahead of its onboarding plan.

This quarter, Boursorama distinguished itself by obtaining 2022 award in the rankings for best online bank awarded by Moneyvox. Boursorama was also classified No. 1 in the rankings for best bank for students in France 2021 awarded by Selectra. The bank also received an award for its retirement savings plan (“MATLA”) from the business magazines Challenges and Le Particulier (Victoire d’or). In addition, the bank received the 2022 Excellence Label for personal loans awarded by Les Dossiers de l’Epargne magazine.

Average outstanding loans rose +28% vs. Q3 20 to EUR 13 billion. Home loan outstandings were up +30% vs. Q3 20.

Average outstanding savings including deposits and financial savings were 30% higher than in Q3 20 at EUR 35 billion, while outstanding deposits were up +29% vs. Q3 20. Life insurance outstandings were 14% higher than in Q3 20 while assets under management in UCITS increased by +35% vs.
Q3 20.

Net banking income excluding PEL/CEL

Q3 21: revenues (excluding PEL/CEL) totalled EUR 1,963 million, up +5.7% vs. Q3 20. Net interest income (excluding PEL/CEL) was up +5.9% vs. Q3 20. Commissions were 5.2% higher than in Q3 20 owing particularly to an increase in financial commissions against the backdrop of recovery.

9M 21: revenues (excluding PEL/CEL) totalled EUR 5,711 million, up +3.6% vs. 9M 20. Net interest income (excluding PEL/CEL) was stable (+0.5%) vs. 9M 20. Commissions were 5.1% higher than in 9M 20, benefiting from the strong growth in financial commissions.

Operating expenses

Q3 21: operating expenses totalled EUR 1,351 million (+4.6% vs. Q3 20) and EUR 1,390 million on an underlying basis. The cost to income ratio (after linearisation of the IFRIC 21 charge and restated for the PEL/CEL provision) stood at 68.8%, an improvement of 0.8 points vs. Q3 20.

9M 21: operating expenses totalled EUR 4,101 million (+3.2% vs. 9M 20) and EUR 4,062 million on an underlying basis. The cost to income ratio (after linearisation of the IFRIC 21 charge and restated for the PEL/CEL provision) stood at 71.8%, an improvement of 0.3 points vs. 9M 20.

Cost of risk

Q3 21: the commercial cost of risk represented a write-back of EUR 5 million or -1 basis point, a significant improvement vs. Q3 20 (24 basis points), and virtually stable vs. Q2 21 (1 basis point).

9M 21: the commercial cost of risk amounted to EUR 124 million or 8 basis points, a substantial decline compared to 9M 20 (52 basis points).

Contribution to Group net income

Q3 21: the contribution to Group net income was EUR 451 million vs. EUR 283 million in Q3 20 (+59% vs. Q3 20). RONE (after linearisation of the IFRIC 21 charge and restated for the PEL/CEL provision) stood at 15.0% in Q3 21 (9.2% in Q3 20) and 16.1% excluding Boursorama.

9M 21: the contribution to Group net income was EUR 1,092 million (+94% vs. 9M 20). RONE (after linearisation of the IFRIC 21 charge and restated for the PEL/CEL provision) stood at 13.2% in 9M 21 (7.1% in 9M 20) and 14.2% excluding Boursorama.

  1. INTERNATIONAL RETAIL BANKING & FINANCIAL SERVICES

In EURm

Q3 21

Q3 20

Change

9M 21

9M 20

Change

Net banking income

2,107

1,891

+11.4%

+12.8%*

5,958

5,605

+6.3%

+9.8%*

Operating expenses

(1,015)

(999)

+1.6%

+2.3%*

(3,115)

(3,124)

-0.3%

+2.6%*

Gross operating income

1,092

892

+22.4%

+24.7%*

2,843

2,481

+14.6%

+19.0%*

Net cost of risk

(145)

(331)

-56.2%

-56.7%*

(408)

(978)

-58.3%

-57.0%*

Operating income

947

561

+68.8%

+75.0%*

2,435

1,503

+62.0%

+69.0%*

Net profits or losses from other assets

4

(2)

n/s

n/s

10

9

+11.1%

+11.1%*

Reported Group net income

584

337

+73.3%

+80.0%*

1,498

928

+61.4%

+69.4%*

Underlying Group net income (1)

570

323

+76.5%

+83.7%*

1,512

942

+60.5%

+68.3%*

RONE

22.6%

12.9%

19.7%

11.6%

Underlying RONE(1)

22.1%

12.3%

19.9%

11.8%

(1) Adjusted for the linearisation of IFRIC 21


International Retail Banking’s loan and deposit production experienced an increase in all geographical regions. Outstanding loans totalled EUR 90.9 billion. They rose +4.3%* vs. end-September 2020. Outstanding deposits were 9.6%* higher than in September 2020, at EUR 90.1 billion.

For the Europe scope, outstanding loans were up +5.1%* vs. September 2020 at EUR 58.1 billion, driven by all the regions: +4.4%* in the Czech Republic, +7.5%* in Romania, and +5.2%* in Western Europe. Outstanding deposits increased by +12.1%*.

In Russia, outstanding loans enjoyed healthy growth (+8.0%*), with a robust performance in home loans and in the corporate customers segment with outstanding loans up +15%* and +7%* respectively vs. Q3 20. Outstanding deposits also rose (+3.6%*).

In Africa, Mediterranean Basin and French Overseas Territories, outstanding loans rose +0.9%*. Outstanding deposits, up +7.2%*, enjoyed a healthy momentum.

In the Insurance business, the life insurance savings business saw outstandings increase +8%* at end-September 2021 vs. September 2020 to EUR 132 billion. The share of unit-linked products in outstandings was 35%, an increase of +5 points vs. September 2020.

Financial Services to Corporates also enjoyed a healthy momentum. Operational Vehicle Leasing and Fleet Management had 1.7 million contracts, including 1.4 million financed vehicles, an increase of 0.6% vs. end-September 2020. Equipment Finance’s new leasing business was up +11%* vs. Q3 20 (+12%* in 9M 21), while outstanding loans were stable vs. end-September 2020, at EUR 14.3 billion (excluding factoring).

Net banking income

Net banking income amounted to EUR 2,107 million in Q3 21, up +12.8%* vs. Q3 20. Revenues amounted to EUR 5,958 million in 9M 21, up +9.8%* vs. 9M 20.

International Retail Banking’s net banking income totalled EUR 1,271 million in Q3 21, an increase of +4.0%* vs. Q3 20. Thanks to a healthy commercial momentum and an increase in commissions (+17%* vs. Q3 20), revenues in Europe were 6.2%* higher than in Q3 20. Activity in the individual customers segment remained particularly robust in specialised consumer finance, with revenues up +14%* vs. Q3 20. For the SG Russia8(2) scope, revenues were down -4.8%* (-1.4%* vs. 9M 20) despite a healthy momentum in the corporate customers and home loan segments. The Africa, Mediterranean Basin and French Overseas Territories scope posted revenues up +4.4%* vs. Q3 20. International Retail Banking’s net banking income totalled EUR 3,689 million in 9M 21, up +2.6%* vs. 9M 20.

The Insurance business posted net banking income up +10.2%* vs. Q3 20, at EUR 246 million in
Q3 21. The gross premiums of the life insurance savings business were 59%* higher in Q3 21 than in Q3 20, with an attractive share of unit-linked products (43%). Protection insurance saw an increase of +7%* vs. Q3 20. Property/casualty premiums rose +10%* (including +8%* in France and +17%* internationally), as did personal protection insurance (+5%* vs. Q3 20). The Insurance business’ net banking income was 8.8%* higher in 9M 21 than in 9M 20 at EUR 720 million.

Financial Services to Corporates’ net banking income was substantially higher (+39.9%*) than in
Q3 20, at EUR 590 million. This performance was driven primarily by the activities of ALD which posted an increase in leasing margins (+12%9(1) vs. Q3 20) and the used car sale result (EUR 1,126 per unit in 9M 21). Financial Services to Corporates’ net banking income totalled EUR 1,549 million in
9M 21, up +32.6%* vs. 9M 20.

Operating expenses

Operating expenses totalled EUR 1,015 million, an increase of +2.3%* on a reported basis and +2.3%* also on an underlying basis vs. Q3 20, in conjunction with the growth in revenue. As a result, the quarter generated a positive jaws effect. The cost to income ratio stood at 48.2% in Q3 21. Operating expenses amounted to EUR 3,115 million in 9M 21, an increase of +2.6%* vs. 9M 20.

In International Retail Banking, operating expenses were up +3.4%* vs. Q3 20. Operating expenses were slightly higher (+2.0%*) in 9M 21 than in 9M 20.

In the Insurance business, operating expenses were in line with the expansion ambitions and rose +4.5%* vs. Q3 20 and +4.3%* vs. 9M 20.

In Financial Services to Corporates, operating expenses increased by +2.0%* vs. Q3 20 and +4.1%* vs. 9M 20.

Cost of risk

Q3 21: the commercial cost of risk amounted to 43 basis points (EUR 145 million), vs. 37 basis points in Q2 21 and 102 basis points in Q3 20.

9M 21: the cost of risk amounted to 41 basis points (EUR 408 million). It was 98 basis points in 9M 20.

Contribution to Group net income

The contribution to Group net income totalled EUR 584 million in Q3 21 (+80.0%* vs. Q3 20) and
EUR 1,498 million in 9M 21 (+69.4%* vs. 9M 20). Underlying RONE stood at 22.1% in Q3 21 (vs. 12.3% in Q3 20) and 19.9% in 9M 21 (11.8% in 9M 20).

  1. GLOBAL BANKING & INVESTOR SOLUTIONS

In EURm

Q3 21

Q3 20

Change

9M 21

9M 20

Change

Net banking income

2,361

2,034

+16.1%

+15.4%*

7,210

5,541

+30.1%

+32.5%*

Operating expenses

(1,608)

(1,478)

+8.8%

+8.2%*

(5,307)

(5,025)

+5.6%

+6.9%*

Gross operating income

753

556

+35.4%

+34.5%*

1,903

516

x 3.7

x 4*

Net cost of risk

(57)

(57)

-

-

(83)

(818)

-89.9%

-89.5%*

Operating income

696

499

+39.5%

+38.4%*

1,820

(302)

n/s

n/s

Group net income

563

381

+47.8%

+46.6%*

1,441

(223)

n/s

n/s

Underlying Group net income (1)

467

295

+58.0%

+56.4%*

1,537

(137)

n/s

n/s

RONE

14.7%

10.3%

13.1%

-2.1%

Underlying RONE(1)

12.2%

7.9%

14.0%

-1.3%

(1) Adjusted for the linearisation of IFRIC 21


Net banking income

In Q3 21, Global Banking & Investor Solutions enjoyed a healthy momentum in its businesses, with revenues of EUR 2,361 million, substantially higher (+16.1%) than in Q3 20.
In 9M 21, revenues rose +30.1% vs. 9M 20 (EUR 7,210 million vs. EUR 5,541 million), and were higher than 9M 19 revenues (EUR 6,518 million).

In Global Markets & Investor Services, net banking income totalled EUR 1,349 million (+8.4% vs.
Q3 20). It amounted to EUR 4,388 million in 9M 21 (+46.1% vs. 9M 20).

The Equity market was active, driven by commercial activity that remained buoyant throughout the quarter. The business posted revenues of EUR 814 million, up +53% vs. Q3 20, with a good performance in all activities. Volumes were particularly high on investment solutions products (structured products and listed products) and on prime services products.
Revenues totalled EUR 2,423 million in 9M 21 (vs. EUR 682 million in 9M 20).

Market conditions were less favourable for the Fixed Income franchise model: substantial spread compression on financing, coupled with reduced client demand in Fixed Income markets. The environment was also unfavourable in Asia. However, commercial activity remained resilient on the Corporates franchise. Fixed Income & Currency activities posted revenues of EUR 380 million in
Q3 21, down -33% vs. a good Q3 20.
Revenues were 21% lower in 9M 21 compared to the exceptionally high level in 9M 20.

Securities Services’ revenues saw a further increase, with revenues up +6.9% vs. Q3 20, at EUR 155 million. They were 10% higher in 9M 21 than in 9M 20, at EUR 490 million.
Securities Services’ assets under custody amounted to EUR 4,475 billion, slightly higher than at end-June 2021. Over the same period, assets under administration were up +2.9%, at
EUR 680 billion.

Financing & Advisory delivered the best historical performance, with revenues of
EUR 757 million in Q3 21, up +31% vs. Q3 20. They amounted to EUR 2,110 million in 9M 21, significantly higher (+13%) than in 9M 20 (+15%* when adjusted for changes in Group structure and at constant exchange rates).

Investment Banking enjoyed an excellent quarter, driven by the strong momentum of advisory, M&A and Leveraged Buyout activities. Revenues from Asset Finance, Natural Resources and Infrastructure activities and the Asset-Backed Products platform also showed a substantial increase.

Global Transaction and Payment Services continued to enjoy strong growth, up +23% vs. Q3 20.

Asset and Wealth Management’s net banking income totalled EUR 255 million in Q3 21 (+21% vs.
Q3 20). It was 6% higher in 9M 21.

Private Banking posted a substantial increase in its revenues (+20% vs. Q3 20) to EUR 184 million. The business benefited from a favourable market environment and strong commercial activity. Net inflow amounted to EUR +2.2 billion during the quarter.
Net banking income totalled EUR 528 million in 9M 21, up +2.3% vs. 9M 20 (when restated for an exceptional impact of EUR +29 million related to an insurance payout received in 2020, it is up +8.4%). Net inflow was high (EUR +6.8 billion in the first nine months) and positive in all geographical regions.
Assets under management totalled EUR 127 billion. They rose +11% vs. end-September 2020.

Lyxor’s net banking income amounted to EUR 64 million, an increase of +21% vs. Q3 20. Assets under management were up +28% vs. end-September 2020, at EUR 169 billion.
Revenues were 17% higher in 9M 21 than in 9M 20, with net inflow of EUR +14 billion.

Operating expenses
Q3 21: operating expenses totalled EUR 1,608 million and EUR 1,733 million on an underlying basis. Higher underlying costs (+9.3% vs. Q3 20) can be explained by the rise in variable costs related to the increase in earnings and IFRIC 21 charges. Thanks to a very positive jaws effect, there was an improvement in the cost to income ratio of 5 points (68% vs. 73% in Q3 20).
9M 21: operating expenses were up +5.6% on a reported basis and +5.4% on an underlying basis.

Net cost of risk
Q3 21: the commercial cost of risk amounted to 14 basis points (or EUR 57 million), the same level as in Q3 20.
9M 21: it was at a low level of 7 basis points, well below 9M 20 (66 basis points) which was adversely affected by the health crisis.

Contribution to Group net income
Q3 21: the contribution to Group net income was EUR 563 million on a reported basis (+48% vs.
Q3 20) and EUR 467 million on an underlying basis (+58% vs. Q3 20).
9M 21: it was EUR 1,441 million and EUR 1,537 million respectively.

Global Banking & Investor Solutions posted a significant underlying RONE of 12.2% in Q3 21 and 14.0% in 9M 21.

  1. CORPORATE CENTRE

In EURm

Q3 21

Q3 20

9M 21

9M 20

Net banking income

228

48

281

(341)

Operating expenses

(196)

(56)

(502)

(239)

Underlying operating expenses (1)

(110)

(69)

(259)

(226)

Gross operating income

32

(8)

(221)

(580)

Underlying gross operating income (1)

118

(21)

22

(567)

Net cost of risk

1

-

1

-

Impairment losses on goodwill

-

-

-

(684)

Income tax

(166)

(84)

(6)

(534)

Reported Group net income

3

(139)

(177)

(1,995)

Underlying Group net income (1)

(69)

(137)

(132)

(586)

(1) Adjusted for the linearisation of IFRIC 21


The Corporate Centre includes:

  • the property management of the Group’s head office,

  • the Group’s equity portfolio,

  • the Treasury function for the Group,

  • certain costs related to cross-functional projects as well as certain costs incurred by the Group and not re-invoiced to the businesses.

The Corporate Centre’s net banking income totalled EUR 228 million in Q3 21 vs. EUR +48 million in Q3 20 and EUR +281 million in 9M 21 vs. EUR -341 million in 9M 20.

Operating expenses totalled EUR 196 million in Q3 21 vs. EUR 56 million in Q3 20. They include the Group’s transformation costs for a total amount of EUR 97 million relating to the activities of French Retail Banking (EUR 46 million), Global Banking & Investor Solutions (EUR 23 million) and the Corporate Centre (EUR 28 million). Underlying costs came to EUR 110 million in Q3 21 compared to EUR 69 million in Q3 20.

Operating expenses totalled EUR 502 million in 9M 21 vs. EUR 239 million in 9M 20. They include the Group’s transformation costs for a total amount of EUR 232 million relating to the activities of French Retail Banking (EUR 106 million), Global Banking & Investor Solutions (EUR 66 million) and the Corporate Centre (EUR 60 million). Underlying costs came to EUR 259 million in 9M 21 compared to EUR 226 million in 9M 20.

Gross operating income totalled EUR 32 million in Q3 21 vs. EUR -8 million in Q3 20 and EUR -221 million in 9M 21 vs. EUR -580 million in 9M 20. Underlying gross operating income came to EUR +22 million in 9M 21.

The Corporate Centre’s contribution to Group net income was EUR 3 million in Q3 21 vs. EUR -139 million in Q3 20 and EUR -177 million in 9M 21 vs. EUR -1,995 million in 9M 20. It includes a capital gain on a property sale amounting to EUR 185 million, before tax is taken into account (EUR 132 million net of tax).

  1. CONCLUSION

The Group delivered an excellent performance in the first 9 months of 2021. All the businesses experienced healthy revenue growth, compared to the first 9 months of 2020, and a improvement in their cost to income ratio due to disciplined cost management.

At end-September 2021, the Group’s CET1 ratio stood at 13.4%10(1) comfortably above its regulatory requirement, after taking account of the distribution provision of EUR 2.0311(2) (financing both dividend and share buyback) and the capital impact of the announced share buyback programme of around EUR 470 million. Authorised by the ECB on September 30th 2021, the Group intends to implement the programme as from November 4th and by end-2021. During this period, the group will suspend the liquidity contract.

Furthermore, the Group continues to execute its strategy with the achievement, this quarter, of a new key milestone. On October 12th, the Group provided information on the model and the detailed organisational structure of its new French Retail Bank. The project to merge the networks is therefore progressing according to the announced timetable. The other businesses are successfully rolling out their strategy presented at the dedicated Investor Days.

  1. 2021 FINANCIAL CALENDAR

2021 Financial communication calendar

February 10th, 2022 Fourth quarter and FY 2021 results
May 5th, 2022 First quarter 2022 results
May 17th, 2022 2022 General Meeting
August 3rd, 2022 Second quarter and first half 2022 results
November 4th, 2022 Third quarter and nine-month 2022 results


The Alternative Performance Measures, notably the notions of net banking income for the pillars, operating expenses, IFRIC 21 adjustment, (commercial) cost of risk in basis points, ROE, ROTE, RONE, net assets, tangible net assets, and the amounts serving as a basis for the different restatements carried out (in particular the transition from published data to underlying data) are presented in the methodology notes, as are the principles for the presentation of prudential ratios.



This document contains forward-looking statements relating to the targets and strategies of the Societe Generale Group.

These forward-looking statements are based on a series of assumptions, both general and specific, in particular the application of accounting principles and methods in accordance with IFRS (International Financial Reporting Standards) as adopted in the European Union, as well as the application of existing prudential regulations.



These forward-looking statements have also been developed from scenarios based on a number of economic assumptions in the context of a given competitive and regulatory environment. The Group may be unable to:

- anticipate all the risks, uncertainties or other factors likely to affect its business and to appraise their potential consequences;

- evaluate the extent to which the occurrence of a risk or a combination of risks could cause actual results to differ materially from those provided in this document and the related presentation.



Therefore, although Societe Generale believes that these statements are based on reasonable assumptions, these forward-looking statements are subject to numerous risks and uncertainties, including matters not yet known to it or its management or not currently considered material, and there can be no assurance that anticipated events will occur or that the objectives set out will actually be achieved. Important factors that could cause actual results to differ materially from the results anticipated in the forward-looking statements include, among others, overall trends in general economic activity and in Societe Generale’s markets in particular, regulatory and prudential changes, and the success of Societe Generale’s strategic, operating and financial initiatives.



More detailed information on the potential risks that could affect Societe Generale’s financial results can be found in the section “Risk Factors” in our Universal Registration Document filed with the French Autorité des Marchés Financiers (which is available on https://investors.societegenerale.com/en).



Investors are advised to take into account factors of uncertainty and risk likely to impact the operations of the Group when considering the information contained in such forward-looking statements. Other than as required by applicable law, Societe Generale does not undertake any obligation to update or revise any forward-looking information or statements. Unless otherwise specified, the sources for the business rankings and market positions are internal.

  1. APPENDIX 1: FINANCIAL DATA

GROUP NET INCOME BY CORE BUSINESS

In EURm

Q3 21

Q3 20

Change

9M 21

9M 20

Change

French Retail Banking

451

283

59.4%

1,092

562

94.3%

International Retail Banking and Financial Services

584

337

73.3%

1,498

928

61.4%

Global Banking and Investor Solutions

563

381

47.8%

1,441

(223)

n/s

Core Businesses

1,598

1,001

59.6%

4,031

1,267

x 3.2

Corporate Centre

3

(139)

n/s

(177)

(1,995)

91.1%

Group

1,601

862

85.7%

3,854

(728)

n/s

CONSOLIDATED BALANCE SHEET

30.09.2021

31.12.2020

Cash, due from central banks

176,531

168,179

Financial assets at fair value through profit or loss

436,594

429,458

Hedging derivatives

14,021

20,667

Financial assets measured at fair value through other comprehensive income

45,780

52,060

Securities at amortised cost

18,687

15,635

Due from banks at amortised cost

66,144

53,380

Customer loans at amortised cost

475,923

448,761

Revaluation differences on portfolios hedged against interest rate risk

172

378

Investment of insurance activities

174,240

166,854

Tax assets

4,307

5,001

Other assets

78,469

67,341

Non-current assets held for sale

390

6

Investments accounted for using the equity method

95

100

Tangible and intangible assets

31,180

30,088

Goodwill

3,821

4,044

Total

1,526,354

1,461,952


30.09.2021

31.12.2020

Central banks

6,684

1,489

Financial liabilities at fair value through profit or loss

386,465

390,247

Hedging derivatives

9,576

12,461

Debt securities issued

133,194

138,957

Due to banks

148,430

135,571

Customer deposits

497,155

456,059

Revaluation differences on portfolios hedged against interest rate risk

4,250

7,696

Tax liabilities

1,683

1,223

Other liabilities

96,568

84,937

Non-current liabilities held for sale

125

-

Liabilities related to insurance activities contracts

152,619

146,126

Provisions

4,491

4,775

Subordinated debts

15,826

15,432

Total liabilities

1,457,066

1,394,973

SHAREHOLDERS' EQUITY

Shareholders' equity, Group share

Issued common stocks and capital reserves

22,364

22,333

Other equity instruments

7,534

9,295

Retained earnings

30,866

32,076

Net income

3,854

(258)

Sub-total

64,618

63,446

Unrealised or deferred capital gains and losses

(980)

(1,762)

Sub-total equity, Group share

63,638

61,684

Non-controlling interests

5,650

5,295

Total equity

69,288

66,979

Total

1,526,354

1,461,952

  1. APPENDIX 2: METHODOLOGY

1 –The financial information presented in respect of Q3 and 9M 2021 was examined by the Board of Directors on November 3rd, 2021 and has been prepared in accordance with IFRS as adopted in the European Union and applicable at that date. This information has not been audited.

2 - Net banking income
The pillars’ net banking income is defined on page 41 of Societe Generale’s 2021 Universal Registration Document. The terms “Revenues” or “Net Banking Income” are used interchangeably. They provide a normalised measure of each pillar’s net banking income taking into account the normative capital mobilised for its activity.

3 - Operating expenses

Operating expenses correspond to the “Operating Expenses” as presented in note 8.1 to the Group’s consolidated financial statements as at December 31st, 2020 (pages 466 et seq. of Societe Generale’s 2021 Universal Registration Document). The term “costs” is also used to refer to Operating Expenses. The Cost/Income Ratio is defined on page 41 of Societe Generale’s 2021 Universal Registration Document.

4 - IFRIC 21 adjustment

The IFRIC 21 adjustment corrects the result of the charges recognised in the accounts in their entirety when they are due (generating event) so as to recognise only the portion relating to the current quarter, i.e. a quarter of the total. It consists in smoothing the charge recognised accordingly over the financial year in order to provide a more economic idea of the costs actually attributable to the activity over the period analysed.

5 – Exceptional items – Transition from accounting data to underlying data

It may be necessary for the Group to present underlying indicators in order to facilitate the understanding of its actual performance. The transition from published data to underlying data is obtained by restating published data for exceptional items and the IFRIC 21 adjustment.

Moreover, the Group restates the revenues and earnings of the French Retail Banking pillar for PEL/CEL provision allocations or write-backs. This adjustment makes it easier to identify the revenues and earnings relating to the pillar’s activity, by excluding the volatile component related to commitments specific to regulated savings.

The reconciliation enabling the transition from published accounting data to underlying data is set out in the table below:

Q3 21 (in EURm)

Operating Expenses

Net profit or losses from
other assets

Impairment losses on goodwill

Income
tax

Group net income

Business

Reported

(4,170)

175

0

(699)

1,601

(+) IFRIC 21 linearisation

(199)

46

(149)

(+) Transformation charges12(*)

97

(27)

70

Corporate Center13(1)

(+) Capital gains on Haussmann office disposal(*)

(185)

53

(132)

Corporate Center

Underlying

(4,272)

(10)

0

(627)

1,391

Q3 20 (in EURm)

Operating Expenses

Net profit or losses from
other assets

Impairment losses on goodwill

Income
tax

Group net income

Business

Reported

(3,825)

(2)

0

(467)

862

(+) IFRIC 21 linearisation

(177)

53

(120)

Underlying

(4,002)

(2)

0

(414)

742


9M 21 (in EURm)

Operating Expenses

Net profit or losses from
other assets

Impairment losses on goodwill

Income
tax

Group net income

Business

Reported

(13,025)

186

0

(1,386)

3,854

(+) IFRIC 21 linearisation

199

(46)

149

(+) Transformation charges(*)

232

(65)

167

Corporate Center14(2)

(+) Capital gains on Haussmann office disposal(*)

(185)

53

(132)

Corporate Center

Underlying

(12,594)

1

0

(1,444)

4,038

9M 20 (in EURm)

Operating Expenses

Net profit or losses from
other assets

Impairment losses on goodwill

Income
tax

Group net income

Business

Reported

(12,363)

82

(684)

(1,079)

(728)

(+) IFRIC 21 linearisation

177

(53)

120

(+) Group refocusing plan

77

77

Corporate center

(-) Goodwill impairment(*)

684

684

Corporate center

(-) DTA impairment (*)

650

650

Corporate center

Underlying

(12,186)

159

0

(482)

803

6 - Cost of risk in basis points, coverage ratio for doubtful outstandings

The cost of risk or commercial cost of risk is defined on pages 43 and 635 of Societe Generale’s 2021 Universal Registration Document. This indicator makes it possible to assess the level of risk of each of the pillars as a percentage of balance sheet loan commitments, including operating leases.

(In EUR m)

Q3 21

Q3 20

9M 21

9M 20

French Retail Banking



Net Cost Of Risk

(5)

130

124

821

Gross loans Outstanding

217,332

217,156

217,549

208,604

Cost of Risk in bp

(1)

24

8

52

International Retail Banking and Financial Services



Net Cost Of Risk

145

331

408

978

Gross loans Outstanding

134,725

129,838

132,088

133,240

Cost of Risk in bp

43

102

41

98

Global Banking and Investor Solutions



Net Cost Of Risk

57

57

83

818

Gross loans Outstanding

167,410

162,429

161,432

165,389

Cost of Risk in bp

14

14

7

66

Corporate Centre



Net Cost Of Risk

(1)

0

(1)

0

Gross loans Outstanding

14,244

12,400

13,589

10,800

Cost of Risk in bp

(1)

(1)

(1)

1

Societe Generale Group



Net Cost Of Risk

196

518

614

2,617

Gross loans Outstanding

533,711

521,822

524,659

518,033

Cost of Risk in bp

15

40

16

67

The gross coverage ratio for doubtful outstandings is calculated as the ratio of provisions recognised in respect of the credit risk to gross outstandings identified as in default within the meaning of the regulations, without taking account of any guarantees provided. This coverage ratio measures the maximum residual risk associated with outstandings in default (“doubtful”).

7 - ROE, ROTE, RONE

The notions of ROE (Return on Equity) and ROTE (Return on Tangible Equity), as well as their calculation methodology, are specified on page 43 and 44 of Societe Generale’s 2021 Universal Registration Document. This measure makes it possible to assess Societe Generale’s return on equity and return on tangible equity.
RONE (Return on Normative Equity) determines the return on average normative equity allocated to the Group’s businesses, according to the principles presented on page 44 of Societe Generale’s 2021 Universal Registration Document.
Group net income used for the ratio numerator is book Group net income adjusted for “interest net of tax payable on deeply subordinated notes and undated subordinated notes, interest paid to holders of deeply subordinated notes and undated subordinated notes, issue premium amortisations” and “unrealised gains/losses booked under shareholders’ equity, excluding conversion reserves” (see methodology note No. 9). For ROTE, income is also restated for goodwill impairment.
Details of the corrections made to book equity in order to calculate ROE and ROTE for the period are given in the table below:

ROTE calculation: calculation methodology

End of period

Q3 21

Q3 20

9M 21

9M 20

Shareholders' equity Group share

63,638

60,593

63,638

60,593

Deeply subordinated notes

(7,820)

(7,873)

(7,820)

(7,873)

Undated subordinated notes

(274)

(274)

Interest net of tax payable to holders of deeply subordinated notes & undated subordinated notes, interest paid to holders of deeply subordinated notes & undated subordinated notes, issue premium amortisations

(34)

(4)

(34)

(4)

OCI excluding conversion reserves

(613)

(875)

(613)

(875)

Dividend provision (1)

(1,726)

(178)

(1,726)

(178)

ROE equity end-of-period

53,445

51,389

53,445

51,389

Average ROE equity

52,947

51,396

52,215

52,352

Average Goodwill

(3,927)

(3,928)

(3,927)

(4,253)

Average Intangible Assets

(2,599)

(2,464)

(2,549)

(2,417)

Average ROTE equity

46,421

45,004

45,739

45,682

Group net Income (a)

1,601

862

3,854

(728)

Underlying Group net income (b)

1,391

742

4,038

803

Interest on deeply subordinated notes and undated subordinated notes (c)

(130)

(127)

(439)

(447)

Cancellation of goodwill impairment (d)

684

Ajusted Group net Income (e) = (a)+ (c)+(d)

1,471

735

3,415

(491)

Ajusted Underlying Group net Income (f)=(b)+(c)

1,261

615

3,599

356

Average ROTE equity (g)

46,421

45,004

45,739

45,682

ROTE [quarter: (4*e/g), 9M: (4/3*e/g)]

12.7%

6.5%

10.0%

-1.4%

Underlying ROTE

46,210

44,884

45,923

47,213

Underlying ROTE [quarter: (4*f/h), 9M: (4/3*f/h)]

10.9%

5.5%

10.4%

1.0%

RONE calculation: Average capital allocated to Core Businesses (in EURm)

In EURm

Q3 21

Q3 20

Change

9M 21

9M 20

Change

French Retail Banking

11,025

11,879

-7.2%

11,201

11,507

-2.7%

International Retail Banking and Financial Services

10,340

10,468

-1.2%

10,154

10,627

-4.5%

Global Banking and Investor Solutions

15,327

14,868

3.1%

14,687

14,306

2.7%

Core Businesses

36,693

37,215

-1.4%

36,042

36,440

-1.1%

Corporate Center

16,254

14,180

14.6%

16,173

15,912

1.6%

Group

52,947

51,396

3.0%

52,215

52,352

-0.3%

(
(1) The provision is calculated on a payout ratio of 50% of underlying Group net income, excluding linearisation of IFRIC 21, after deducting interest on deeply subordinated notes and undated subordinated notes

8 - Net assets and tangible net assets

Net assets and tangible net assets are defined in the methodology, page 46 of the Group’s 2021 Universal Registration Document. The items used to calculate them are presented below:

End of period

9M 21

H1 21

2020

Shareholders' equity Group share

63,638

63,136

61,684

Deeply subordinated notes

(7,820)

(8,905)

(8,830)

Undated subordinated notes

-

(62)

(264)

Interest, net of tax, payable to holders of deeply subordinated notes & undated subordinated notes, interest paid to holders of deeply subordinated notes & undated subordinated notes, issue premium amortisations

(34)

(1)

19

Bookvalue of own shares in trading portfolio

(45)

(46)

301

Net Asset Value

55,739

54,122

52,910

Goodwill

(3,927)

(3,927)

(3,928)

Intangible Assets

(2,641)

(2,556)

(2,484)

Net Tangible Asset Value

49,171

47,639

46,498

Number of shares used to calculate NAPS*

850,430

850,429

848,859

Net Asset Value per Share

65.5

63.6

62.3

Net Tangible Asset Value per Share

57.8

56.0

54.8

* The number of shares considered is the number of ordinary shares outstanding as at September 30th, 2021, excluding treasury shares and buybacks, but including the trading shares held by the Group.
In accordance with IAS 33, historical data per share prior to the date of detachment of a preferential subscription right are restated by the adjustment coefficient for the transaction.

9 - Calculation of Earnings Per Share (EPS)

The EPS published by Societe Generale is calculated according to the rules defined by the IAS 33 standard (see page 45 of Societe Generale’s 2021 Universal Registration Document). The corrections made to Group net income in order to calculate EPS correspond to the restatements carried out for the calculation of ROE and ROTE. As specified on page 45 of Societe Generale’s 2021 Universal Registration Document, the Group also publishes EPS adjusted for the impact of non-economic and exceptional items presented in methodology note No. 5 (underlying EPS).
The calculation of Earnings Per Share is described in the following table:

Average number of shares (thousands)

9M 21

H1 21

2020

Existing shares

853,371

853,371

853,371

Deductions

Shares allocated to cover stock option plans and free shares awarded to staff

3,335

3,466

2,987

Other own shares and treasury shares

Number of shares used to calculate EPS**

850,036

849,905

850,385

Group net Income

3,854

2,253

(258)

Interest on deeply subordinated notes and undated subordinated notes

(439)

(309)

(611)

Capital gain net of tax on partial buybacks

Adjusted Group net income

3,415

1,944

(869)

EPS (in EUR)

4.02

2.29

(1.02)

Underlying EPS* (in EUR)

4.06

2.40

0.97

(*) Calculated on the basis of underlying Group net income excluding linearisation of IFRIC 21. Or EUR 4.23 taking into account the linearisation of IFRIC 21 in 9M 21.
(**) The number of shares considered is the number of ordinary shares outstanding as at September 30th, 2021, excluding treasury shares and buybacks, but including the trading shares held by the Group.

10 – The Societe Generale Group’s Common Equity Tier 1 capital is calculated in accordance with applicable CRR2/CRD5 rules. The fully loaded solvency ratios are presented pro forma for current earnings, net of dividends, for the current financial year, unless specified otherwise. When there is reference to phased-in ratios, these do not include the earnings for the current financial year, unless specified otherwise. The leverage ratio is also calculated according to applicable CRR2/CRD5 rules including the phased-in following the same rationale as solvency ratios.

NB (1) The sum of values contained in the tables and analyses may differ slightly from the total reported due to rounding rules.

(2) All the information on the results for the period (notably: press release, downloadable data, presentation slides and supplement) is available on Societe Generale’s website www.societegenerale.com in the “Investor” section.

Societe Generale

Societe Generale is one of the leading European financial services groups. Based on a diversified and integrated banking model, the Group combines financial strength and proven expertise in innovation with a strategy of sustainable growth, aiming to be the trusted partner for its clients, committed to the positive transformations of society and the economy.

Active in the real economy for over 150 years, with a solid position in Europe and connected to the rest of the world, Societe Generale has over 133,000 members of staff in 61 countries and supports on a daily basis 30 million individual clients, businesses and institutional investors around the world by offering a wide range of advisory services and tailored financial solutions. The Group is built on three complementary core businesses:

  • French Retail Banking, which encompasses the Societe Generale, Crédit du Nord and Boursorama brands. Each offers a full range of financial services with omnichannel products at the cutting edge of digital innovation;

  • International Retail Banking, Insurance and Financial Services to Corporates, with networks in Africa, Russia, Central and Eastern Europe and specialised businesses that are leaders in their markets;

  • Global Banking and Investor Solutions, which offers recognised expertise, key international locations and integrated solutions.

Societe Generale is included in the principal socially responsible investment indices: DJSI (World and Europe), FTSE4Good (Global and Europe), Bloomberg Gender-Equality Index, Refinitiv Diversity and Inclusion Index, Euronext Vigeo (Europe and Eurozone), STOXX Global ESG Leaders indexes and MSCI Low Carbon Leaders Index (World and Europe).

In the event of any doubt regarding the authenticity of this press release, go to the bottom of the newsroom of societegenerale.com. Press releases from Societe Generale are certified by blockchain technology. A link will enable you to verify the integrity of this information.

For more information, you can follow us on twitter @societegenerale or visit our website www.societegenerale.com.

(1) Underlying data (see methodology note No. 5 for the transition from accounting data to underlying data)
(2) Phased-in ratio; fully-loaded ratio of 13.2%
(3) After deducting interest on deeply subordinated notes and undated subordinated notes
The footnote * in this document corresponds to data adjusted for changes in Group Structure and at constant exchange rates
(1) NPL ratio calculated according to the EBA methodology published on July 16th, 2019
(2) Ratio between the amount of provisions on doubtful outstandings and the amount of these same outstandings
(1) Underlying data (see methodology note No. 5 for the transition from accounting data to underlying data)
(2) Including BMTN (negotiable medium-term notes)
(2) SG Russia encompasses the entities Rosbank, Rosbank Insurance, ALD Automotive and their consolidated subsidiaries
(1) Based on ALD local data
(1) Phased-in ratio; fully-loaded ratio of 13.2%
(2) Based on a payout ratio of 50% of underlying Group net income after deducting interest on deeply subordinated notes and undated subordinated notes
(*) Exceptional item
(1) Transformation and/or restructuring charges in Q3 21 related to French Retail Banking (EUR 46m), Global Banking & Investor Solutions (EUR 23m) and Corporate Centre (EUR 28m)
(2) Transformation and/or restructuring charges in 9M 21 related to French Retail Banking (EUR 106m), Global Banking & Investor Solutions (EUR 66m) and Corporate Centre (EUR 60m)


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