Société Générale posts strongest quarter since 2008, doling out billions to shareholders
Société Générale, one of Europe's leading banks, announced its quarterly results this morning, revealing a robust performance that has prompted the bank to raise its profitability targets for 2025.
The bank's net income for the second quarter soared by 30.6% year-on-year, reaching €1.45 billion, while revenues grew 1.6% to €6.8 billion. These figures surpassed analyst expectations, marking the highest quarterly results since the 2008 financial crisis.
Following this strong performance, Société Générale has set a new target for a return on tangible equity (ROTE) of around 9% for 2025, up from the previous target of above 8%. The bank attributes this ambitious goal to its robust first-half results, which include a 10.3% ROTE achieved so far.
Other financial highlights and projections include an operating income increase of 21.8% year-on-year to €2.11 billion, net banking income growth expected to exceed 3% year-on-year in 2025, and cost reductions that continue to improve efficiency. The Q2 cost-to-income ratio dropped 4.6 percentage points to 63.8%, and overall costs decreased 2.6% in H1 2025.
Société Générale's strong capital position, with a Common Equity Tier 1 (CET1) ratio of 13.5%, well above regulatory requirements, enables a €1 billion share buy-back and an interim dividend of €0.611 per share. The bank's private banking assets under management grew 6% in Q2 to €132 billion, with net asset inflows accelerating.
CEO Slawomir Krupa emphasized the bank's continued focus on executing the 2026 roadmap aimed at sustainable, profitable growth and digital expansion to 8 million clients. The bank's stock has been the best performer in the Euro Stoxx Banks this year, with a performance of over 100%.
In summary, Société Générale's updated financial projections reflect confidence in sustained revenue growth, enhanced operational efficiency, and solid capital buffers. This positions the bank well for continued performance improvement through 2025 and beyond despite macroeconomic uncertainties. Shareholders will receive an interim dividend of 0.61 euros per share on October 9, and the bank plans to start its €1 billion share buy-back next week on August 4.
References: 1. Société Générale Q2 Results 2. Société Générale Raises 2025 Profitability Targets 3. Société Générale's Q2 Net Income Surges 30.6% 4. Société Générale's Net Banking Income to Grow Over 3% in 2025 5. Société Générale's Cost Reductions Improve Efficiency
- Société Générale's robust performance in the second quarter, marked by a significant increase in net income and revenues, has ignited interest in investing in the bank's business operations.
- The bank's ambitious goal for a return on tangible equity (ROTE) of around 9% in 2025, alongside cost reductions and continued growth projections, demonstrates the potential for high returns on investing in Société Générale's finance sector.
