Societe Generale: A Rock-Solid Performance in Q4 2024

Societe Generale, one of Europe's largest banking groups, has reported strong financial results for the fourth quarter and full year 2024, with all targets exceeded ahead of plan. The bank's strategic plan execution has contributed significantly to its enhanced commercial performance and increased client acquisition, driven by several key initiatives and transformations within its businesses.



Enhanced Commercial Performance and Increased Client Acquisition

Societe Generale's enhanced commercial performance can be attributed to several factors, including the successful implementation of a new operating model in the French networks, which has driven a strong rebound in Net Interest Income and increased fees. The bank's online banking and brokerage services arm, BoursoBank, has also seen remarkable success, with a record annual and quarterly organic client acquisition, reaching 6 million clients by January 2024. This growth has been achieved while maintaining profitability, with plans to exceed 8 million clients in 2025.

The integration of LeasePlan has also contributed to the group's strong performance in Global Markets, with high levels of revenues in Transaction Banking driven by Cash Management. The finalisation of previously announced disposals, such as the subsidiaries in Congo and Chad, has further streamlined the portfolio and contributed to the bank's improved performance.

Improved Cost Structure and Risk Profile

Societe Generale has managed its cost structure and risk profile effectively to achieve a significant improvement in its cost-to-income ratio and profitability. The bank has implemented a linear improvement of operational efficiency, aiming for around EUR 500 million in additional gross savings in 2024, with EUR 750-800 million in transformation costs. This has helped to stabilize operating expenses and improve the cost-to-income ratio, which was reduced by 4.8 percentage points compared to 2023, reaching 69.0%.

The bank has also maintained a disciplined approach to risk management, with a low cost of risk at 17 basis points in 2023 and an expected range of 25 to 30 basis points in 2024. This has been achieved while containing the cost of risk at 24 basis points in Q4 2023 and maintaining a high S1/S2 inventory of around EUR 3.6 billion at the end of 2023.



Strong Capital and Liquidity Ratios

Societe Generale has strengthened its capital and liquidity ratios, with a CET1 ratio of 13.1% at the end of 2023, around 340 basis points above the regulatory requirement. This has been achieved through a strong capital build-up of 20 basis points, ahead of the planned trajectory, with a CET1 ratio of 13.3% in 2024. The bank has also maintained a Liquidity Coverage Ratio (LCR) of 160% at the end of 2023, ensuring its ability to meet liquidity needs in stressed conditions.

Increased Distribution and Shareholder Remuneration

Societe Generale's strong performance has also translated into increased distribution and shareholder remuneration. The bank has proposed a distribution of EUR 1,740 million for 2024, representing a 75% increase compared to 2023. This includes a cash dividend of EUR 868 million, equivalent to EUR 1.09 per share, and a share buyback programme of EUR 872 million. The increased distribution payout ratio from 40%-50% to 50% from 2024 onwards is based on Group net income, ensuring a balanced mix between cash dividend and share buybacks.



In conclusion, Societe Generale's strong financial performance in Q4 2024 is a testament to the successful execution of its strategic plan, driven by enhanced commercial performance, increased client acquisition, improved cost structure, and disciplined risk management. The bank's commitment to supporting the United Nations' Sustainable Development Goals, combined with its strong capital and liquidity ratios, positions it among Europe's top-tier, rock-solid, and sustainable banks. As the bank looks ahead to 2025, it is well-positioned to drive growth and commercial development, with a focus on client acquisition and customer satisfaction.