Societe Generale first-quarter profit fell 26% over the first three months of the year, as challenging market conditions continued to hobble Europe's banks.
SocGen, France's third-largest bank, posted net income of 631 million euros ($705 million) for the first three months of the year. That compared with net income of 850 million euros a year earlier and 624 million euros in the final three months of 2018.
Analysts polled by Reuters had expected first-quarter profit to come in around 637 million euros.
Shares of SocGen were up more than 2% during early morning deals.
Here are some of the key takeaways:
- First-quarter net income came in at 631 million euros, down from 850 million euros a year ago.
- Revenues came in at 6.2 billion euros, down more than 1% when compared to the same three-month period in 2018.
- The bank's core capital ratio stood at 11.7% at the end of the first quarter.
"I am happy with the beginning of the year," Frederic Oudea, CEO of SocGen, told CNBC's Julianna Tatelbaum on Friday.
"I must say the very good news is on the capital ratio and we are showing that yes, we can definitely address this issue," Oudea said.
Its common equity tier 1 ratio, which indicates a bank's strength, stood at 11.7% at the end of the first quarter.
A protracted period of low interest rates has curtailed returns for retail banking in recent years, prompting SocGen — as well as other big European banks — to rely on the more volatile earnings from corporate and investment banking, with mixed results.
Economic outlook
Last month, the Paris-based bank announced a plan to cut 1,600 jobs — mainly at its corporate and investment banking arm — in a bid to boost profitability after last year's poor performance.
"Investors, after the fourth quarter in 2018, were very much in a wait-and-see mode, wondering where markets would go, wondering on the economy etc," Oudea said.
"If, as we think, people are a little bit more comfortable with the economic outlook going forward and of the major risks, these things should potentially vanish," he added.
Revenues for the quarter came in at 6.2 billion euros, down more than 1% when compared to the same period a year earlier.
The lender had previously announced it would cut 500 million euros in costs at its corporate and investment banking unit in early February after its fourth-quarter results were hit by a steep market downturn, which in turn forced it to lower both profitability and revenue growth targets.
