PARIS (dpa-AFX) - French lender Societe Generale SA (SCGLF.PK, SCGLY.PK) said Thursday that its Group performance in the fourth quarter of 2018 was affected by IFRS 5 accounting of disposals and a challenging environment in global capital markets.
The company noted that as a result of the IFRS 5 accounting of disposals implemented by the Group, including the previously announced sales of Societe Generale Serbia and of the Group's stake in La Banque Postale Financement, it will book an exceptional charge of about 240 million euros in the Corporate Centre in the fourth quarter.
Societe Generale expects the challenging market environment in global capital markets to result in a decline in Global Markets and Investor Services revenues of about -20 percent in the fourth quarter versus the year-ago period, and of approximately -10 percent in 2018 versus 2017, as well as a significant increase in market risk weighted assets.
However, the company noted that the performance of all activities within the International Retail Banking and Financial services as well as the Financing and Advisory businesses are expected to be solid in the quarter. French Retail Banking performance is expected to be in line with guidance.
The 2018 Group cost of risk is expected to be within the 20 to 25 basis points range, as per Group guidance.
The company expects pro forma Group CET1 ratio to be between 11.4 percent and 11.6 percent as of the fourth quarter, in line with its 12 percent CET1 target in 2020.
Societe Generale's board of directors intends to propose a stable dividend for 2018, of 2.20 euros per share, and has decided to propose to shareholders the option of a dividend payment in shares.
Copyright RTT News/dpa-AFX