Societe Generale SA Q1 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Flora Bocahut - Barclays Capital - Analyst : Thank you. Good morning. The first question is on cost. Costs were much better than expected this quarter. It was in particular the case in the French retail banking division. So can you just elaborate on what the drivers of the lower cost base have been this quarter and how sustainable you think this performance is? So basically, elaborate on the work you've been doing on the cost base here. And the second question is still on French retail, but this time on the return on equity, I think you achieved almost 10% this quarter in French retail. Normally it's only the beginning of the improvement in the division, so I'd be curious to know what kind of money you think you can get to in French retail on a multi-year review. Thank you.

Question: Tarik EL Mejjad - Bank of America Merrill Lynch - Analyst : Hi, good morning and congratulations on this good quality set of results. Two questions from me as well. First, I will come back on costs, so I hear you about the focus and efforts on improving cost efficiency. But if I do some, if I calculate, sorry, if I -- If I want to To make sure that you reach 60 below 60% cost on target in France and the group in '26, I calculate there's still 500 million, 700 million cost savings to to implement. This is considering actually consensus and not extrapolating the strong Q1. Global market performance. Where are the areas that you you can still work on to address that GAAP and should we expect more fresh announcements in the in the future? And then the second question on capital return strong capital build this quarter, doing some simple maths, if I start with 13.4% in Q1, I deduct 35 bits of FTB to be conservative. And add 1,015 bits of cap generation in the Q2 that leads me to around 13.2% in the first half. That's more than one basis point above 13% fully loaded Basel 4 targets. Now if I look at full year and add backFTB because that's not been deducted this year, your CG1 reported will be below above 13.6%, which would actually could penalize the ROT progress growth. I mean, with this in mind, is it fair to expect more distribution in the second half of this year, or is it fair to wait for the full year? And I would be happy to hear your thinking here. And last one, really little capital. I'm only asking because I get 10 -- I'm asked 10 times a day by investors. What's your position on introducing an interim dividend for that topic. Thank you.

Question: Flora Bocahut - Barclays Capital - Analyst : Good morning. Thank you.

Question: Matthew clark - Mediobanca - Analyst : Hello. So, firstly, another question on capital, please. Could you say whether bar breaches or counterparty risk or anything like that as a result of April volatility are likely to have a noticeable impact on your risk-weighted assets, for the second quarter, just any comfort you can give, on how you've fared in the recent volatility. And then a sort of similar question, but from the opposite direction, your market risk went down in the first quarter, despite clearly lots of opportunities in the market. Do you think you were leaving money on the table there? Could you be more aggressive, or do you think that really you're, you were deploying as much capital as you think it was prudent to do, in that environment? And then a final question, on French retail NILA. Again, when I TRY to reverse out the scope impact of the sale of Switzerland, from your year on year gross numbers, it sort of suggests a 30 million-ish impact there, which seems a bit high, so intuitively to me. So can you just confirm what the scope impact of the first quarter versus fourth quarter. I was on NII and then what the remaining impact that's, yet to come through in subsequent quarters is, from, the sale of the UK business. Thank you.

Question: Matthew clark - Mediobanca - Analyst : And that that's both businesses, UK and Switzerland. Okay. Thank you.

Question: Giulia Aurora Miotto - Morgan Stanley - Analyst : Yes, hi, good morning. My first question is on this year's target. RTE above 8% cost income below 66%. Why not upgrade these targets because it seems like you're way ahead of them. Is there anything negative you see coming, or, yeah, any comment there? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 30, 2025 / 8:30AM, SOGN.PA - Q1 2025 Societe Generale SA Earnings Call And then, secondly, Spanish banks have a very good asset liability management disclosure in terms of hedges, in terms of, alco portfolio, duration, yields and all of that. And Leo, is there a plan to bring something similar to Songjam because I think the market would benefit from better visibility on, yeah, on hedges. And I'm not talking about just French Schwier. I know we talked about it a lot in general, but I think having a better understanding of the group NAI evolution would be beneficial. Thank you.

Question: Giulia Aurora Miotto - Morgan Stanley - Analyst : Thanks. Yes, we are asking the same question to the other French banks. I think the French are very good at disclosing these things. So I would benchmark for them against the pan-European banks, but thank you.

Question: Kiri Vijayarajah - HSBC - Analyst : Yes, sir, good morning, everyone. A couple of questions if I may. So firstly, just on your IFRS 9 provisioning and your macro scenarios, assumptions, etc. When I look at slide 4 and that box on the left, is the message that the tariff impact and the fiscal stimulus side. Largely offset each other, so you're kind of confident that there's no need to alter your input assumptions for now, or is it more a case that actually it's, you're going to have to wait until mid-year or even year-end to make a more thorough assessment, as things get a bit clearer. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 30, 2025 / 8:30AM, SOGN.PA - Q1 2025 Societe Generale SA Earnings Call So how should we interpret the message on the macro assumptions, for the purposes, of IFRS 9, and then on the excess capital position at Avens, I know it's very early days, but hypothetically, If Avons were to do a share buyback, would Socgen participate pro rata? Would you like to let your percent ownership in Avon's creep up, so just your thoughts there, because Avons as well is in a position where they should be contemplating extra capital return as well. Thank you.

Question: Kiri Vijayarajah - HSBC - Analyst : Understood. Thank you, Slavamir. Cheers.

Question: Anke Reingen - RBC Capital Markets. - Analyst : Yeah, thank you for taking my questions. The first one, sorry, just coming back on costs. I just noted the, yeah, slow growth in the cost in CIB in spite of the strong revenue goals, and I just want to make sure that's basically because some of the cost savings coming through not because there could potentially be like a two up later in the year. And in terms of cost savings, I don't know if you've given like an absolute number your target for 2025 and maybe just on how far or how much is realized at the age at the Q1 stage. And then, secondly on on your banker, I mean the new acquisitions in Q1 are still running at a relatively high level. I'm just trying to understand if you changed anything in terms of your view, slowing down customer acquisitions or is it just, I mean is it more cheaper or more opportun to call the customer base at the moment. Thank you very much.

Question: Anke Reingen - RBC Capital Markets. - Analyst : Thank you.

Question: Jacques- Henri Gaulard - Kepler Cheuvreux - Analyst : Yes, good morning. Well done on the results. Two questions. First, on the corporate center on the slide 22, you're mentioning the management action to more efficiently use excess liquidity can assume that this improvement is something that could actually linger now structurally in the corporate center. Just to get the guidance up there just in case. And the second question, more generally is on the equities business on which really, you have phenomenal performance, which is not totally intuitive considering that some of your competitors have been much more vocal about how much they spend and everything. What is your ambition for that business? Eventually, I would say 23 years down the road and maybe a little bit link that to your fixed income business, which is probably not as big as you would wish it to be, or do you view? Those two businesses are a little bit more independent. Thank you.

Question: Jacques- Henri Gaulard - Kepler Cheuvreux - Analyst : Thank you.

Question: Sharath Ramanathan - Deutsche Bank - Analyst : Good morning. Thank you for taking my questions. I just have one left. Can you provide us the USD exposures in terms of revenues and costs? Also, is there any CT one sensitivity on account of the USD depreciation? Thank you.

Question: Flora Bocahut - Barclays Capital - Analyst : Thank you really yeah.

Question: Joseph Dickerson - Jefferies International - Analyst : I thank you. Firstly, just a point of clarification on the interim dividend consideration, I presume that's for this year's dividend. Can you clarify that? And then going back to the question on BursoBank. A clearly by the end of Q2, assuming similar run rates, you'll be at or about the 8 million magic number for customers. Would you expect in the second half that some of the customer acquisition costs can fall away so that next year, we're still looking at, greater than 300 million of earnings and staying on board, so the 16% deposit growth, is that, has there been any amplification? In the first quarter from the Burso first launch in December. Thank you.