SocGen’s net income boosted by sale of Visa Europe stake

Proceeds from the sale of its stake in card payment firm Visa Europe helped Societe Generale post a sharp rise in quarterly net income and offset pressure from low interest rates and weak trading income.

France’s second-largest listed bank reported net income for the quarter of €1.46 billion on revenue of €6.98 billion, up 8.1 per cent on a year ago. The result included a 662 per cent after tax gain on the sale of Visa Europe shares.

SocGen said its revenue, excluding the Visa transaction, was stable in the second quarter, as stronger results in its international retail banking and financial services division helped outweigh a weaker performance in French retail and investment banking.

SocGen is cutting its retail and investment banking costs and restructuring its loss-making Russia operations in a bid to improve profitability but, along with other banks, it is struggling to hit its targets as litigation and regulatory expenses rise.

Highlighting the challenges, SocGen’s return on common equity - a measure of how well it uses shareholders’ money to generate profit - was 7.4 per cent in the first half of the year, down from 10.3 per cent a year ago.

Reuters