Societe Generale shares popped more than 7% in early Thursday trading after the French bank raised its full-year profitability target and reported second-quarter earnings that topped expectations, helped by a sharp recovery in its French retail business.
The bank now aims for a return on tangible equity of around 9% in 2025, up from a previous goal of above 8%. It also lowered its cost-to-income ratio target for this year to below 65%, compared with a prior forecast of under 66%.
Second-quarter group net income rose 31% year-on-year to €1.45 billion, beating the €1.19 billion average estimate from 15 analysts surveyed by the company. Revenue climbed 1.6% to €6.79 billion, also ahead of expectations.
The division housing SocGen’s core French retail operations doubled its net profit, supported by a 15% increase in net interest income (NII).
"We see confirmed growth in French retail including BoursoBank which has reached 8.0m customers and should be on-track to start dialing back customer acquisition costs in ’26," Jefferies analyst Joseph Dickerson said in a note.
The investment banking unit reported revenue in line with consensus. Fixed income and currency trading rose 7.3% to €615 million, while equities trading slipped 2.9% to €962 million.
The bank’s markets business saw less benefit from the recent volatility triggered by U.S. tariff moves than some of its global and domestic rivals.
Societe Generale also unveiled a new €1 billion share buyback program, set to begin on August 4.
