Profits drop at SocGen

5 August 2008

Profits fell 63 per cent at Societe Generale over the second quarter, the French bank has admitted.

The firm declared a net income for the three months of $1 billion - with the global credit crunch continuing to negatively affect performance.

However, the profits slightly exceed those forecast in an analysts' poll conducted by news agency Bloomberg.

SocGen also bore a $7.6 billion financial hit at the turn of the year thanks to unauthorised trades by ex-employee Jerome Kerviel, who is currently awaiting trial in France.

As a result of these troubles, shares in the bank have fallen by 36 per cent in Paris so far in 2008.

Chief executive Frederic Oudea indicated that he remained upbeat about the bank's prospects, adding that the net earnings "reflects the robustness" of the business.

However, he also admitted that, with credit markets across the globe still frozen, it faces "a crisis on an exceptional scale".

SocGen is France's second-largest bank.

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