...Diversified Universal Bank Franchise: Societe Generale's (SG) Issuer Default Ratings (IDRs), Viability Rating (VR) and senior debt ratings reflect the bank's sound company profile underpinned by selected franchise strengths across a diverse range of products and geographies. These include French retail banking, European commercial banking, euro- denominated bond activity and equity derivatives. SG's diversified universal banking business model has allowed the bank to generate satisfactory, albeit moderately volatile, earnings. High Unreserved Impaired Loans: SG's asset quality remains weaker than French and global trading and universal bank (GTUB) peers, despite gradual improvements. Impaired loans was 5.7% of gross loans at end-2016, partly reflecting higher-risk pockets in its international retail banking portfolio. Unreserved impaired loans were about 20% of Fitch Core Capital (FCC), despite adequate coverage at 63%, which exposes the bank to the realisation of collateral, often in the...
