At its August 3rd 2010 meeting, the Board of Directors of Societe Generale approved the financial statements for Q2 and H1 2010. With Group net income of EUR 1.08 billion in Q2 2010 (EUR 2.15 billion in H1), Societe Generale has confirmed its rebound.
The Group diversification of its international retail banking operation, continues to see a gradual recovery in the earnings of Specialized Financial Services’ activities as well as the Private Banking, Global Investment Management and Services division and has provided further evidence of the resilience of its market activities and the commercial dynamism of its financing offerings in Corporate and Investment Banking.
Frederic Oudea, the Group's Chairman and CEO, has stated: «H1 2010 testifies to the Group's new commercial momentum with an excellent performance from Retail Banking activities and a satisfactory contribution to the results from Corporate and Investment Banking despite a challenging market environment. The results published today confirm Societe Generale's rebound, while the company's transformation program, presented to the market on June 15th, is already under way, with the first portfolio arbitrages and the launch of projects for the sharing of information systems. In a macroeconomic environment in the process of stabilizing, I am more than ever confident of the Group's ability to achieve the objectives of its Ambition 2015 plan».
The economic recovery which began at end-2009 is growing stronger. However, it remains fragile with the strength of the recovery varying across geographical regions. In Europe, in particular, growth prospects remain moderate and, with the ongoing Greek crisis, a climate of substantial mistrust in relation to the sovereign debt of the most fragile European countries and the euro zone as a whole has spread to the financial and interbank markets.
In order to restore confidence in the European banking system, European regulators published (on July 23rd) the results of stress tests for 91 European banks
as well as their exposure to sovereign issuers. This transparency exercise provided confirmation of the financial solidity of the vast majority of European banks, including the four main French banks, which had already proved their resilience during the recent crisis.
The quality of Societe Generale's portfolio of activities, in particular, is demonstrated with an estimated Tier 1 ratio under stress at end-2011 of 10%. Moreover, initial responses have been provided concerning the new banking regulatory framework "Basel III". However, crucial factors such as the ultimate calibration for capital requirements will only be known towards the end of the year.