Société Générale reports 52% drop in profit

French bank Société Générale reported a 52 per cent drop in profit for the second quarter on asset writedowns and higher loan…

French bank Société Générale reported a 52 per cent drop in profit for the second quarter on asset writedowns and higher loan-loss provisions.

Net income fell to €309 million from €644 million a year earlier, the Paris-based bank said in a statement today.

Earnings exceeded the €68 million median estimate of 16 analysts surveyed by Bloomberg as the loss at the investment bank narrowed.

The bank’s results trailed larger French competitor BNP Paribas for a second quarter in a row as the bank marked down investments and set aside more money for souring loans.

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BNP Paribas said yesterday that profit increased 6.6 per cent to €1.6 billion, helped by the acquisition of Fortis assets and higher investment-banking revenue.

Société Générale said last month that net income was “slightly positive” in the second quarter after writedowns.

The corporate- and investment-banking unit recorded a 12 million-euro net loss in the second quarter, narrowing from a €180 million deficit a year earlier.

Revenue from the equities business rose 4.2 per cent to €745 million, Société Générale said.

While client demand shrank for complex products, there was a rebound in flow products compared with the first quarter, the company said.