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* SocGen's shares up 3.9%, best performer in CAC-40
Common equity tier 1 ratio hits 2020 target of 12%
* Investors were concerned bank might need to raise fresh capital (Adds share price, details.)
By Inti Landauro and Matthieu Protard
PARIS, Aug 1 (Reuters) - Shares of Societe Generale , France's third-largest bank by market capitalisation, jumped on Thursday after it hit its solvency target a year early, easing investor concerns it would have to raise more capital.
Although net profit fell in the second quarter, the bank met its 2020 goal of raising its common equity tier 1 ratio, an indicator of a lender's solvency, to 12% from 11.5%, thanks to asset disposals and the payment of parts of its dividends in shares instead of cash.
"This was the priority. At the beginning of the year, some of our investors wondered whether we would need to raise capital," SocGen's Chief Executive Frederic Oudea said in an interview with French radio station BFM.
SocGen shares jumped 5% in early trading and were last up 3.9%, leading the Paris blue chip CAC-40 index, having underperformed the broader stock market so far this year with a fall of 17%.
After years of low interest rates curtailed returns for retail banking, SocGen, cross-town rival BNP Paribas and other big European banks have grown more reliant on more volatile earnings from corporate and investment banking.
But a difficult fourth quarter of 2018 for those businesses prompted SocGen and BNP Paribas to restructure and close some unprofitable businesses such as proprietary trading.
SocGen's results were weaker than those of its larger domestic rival, which this week reported a forecast-beating second quarter net profit of 2.5 billion euros.
Jefferies' analysts Maxence Le Gouvello Du Timat and Martina Matouskova said in a research note that SocGen had nonetheless performed better than investors had expected. "Great achievement on capital and underlying is better than expected. We expect the stock to outperform the sector," they said.
Net profit fell 14% to 1.05 billion euros ($1.16 billion)during the second quarter compared with the same period a year ago, hit by the restructuring costs at its corporate and investment banking unit, with revenues down 2.6% to 6.28 billion euros.
UBS, Credit Suisse and Jefferies respectively expected net profit of 928 million euros, 833 million euros and 1.08 billion euros.
Societe Generale booked a 227 million euro charge related to its plan to restructure its corporate and investment banking unit by reducing 500 million euros worth of costs and cutting 1,600 jobs.
($1 = 0.9053 euros) (Reporting by Inti Landauro and Matthieu Protard; Editing by Kirsten Donovan)