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Societe Generale announces increased profits

French bank Societe Generale has announced first quarter net profits of $1.89 billion, off the back of buoyant corporate and investment banking activities.

The profits were up from $1.57 billion for the same period of 2005, an increase of around 20 per cent, and beat many analysts' predictions, with forecasts averaging at around $1.6 billion for the first three months of this year.

In a statement, Societe Generale said that it had had an "excellent first quarter" thanks to "an economic and financial environment which was very favourable for the group's businesses".

Like many of its competitors, the bank profited heavily from its investment and corporate banking businesses, which constitutes most of Societe Generale's operations.

It also benefited from the continued growth of the French housing market, and higher taxation of housing savings accounts in France which prompted an increase in retail banking as customers sought to transfer money to other investment products.

Societe Generale saw retail banking profits rise nearly 32 per cent to $403 million.