SocGen net profit falls 63 pct

Tue Aug 5, 2008 6:39am BST
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PARIS (Reuters) - Societe Generale reported a 63 percent fall in second quarter net profit on Tuesday, with the shadow of the world's worst rogue trader scandal still hanging over France's second-biggest listed bank.

Net profit fell to 644 million euros (510.5 billion pounds), with earnings hit by a loss at SocGen's corporate and investment banking division. Last year it was 1.74 billion.

Eighteen analysts polled by Reuters gave an average net profit forecast of 518 million euros. Forecasts had ranged widely, with some expecting an overall group loss, while others had forecast a net profit of around a billion euros.

Gross operating profit fell 42 percent to 1.627 billion euros, also ahead of an average forecast of 1.333 billion.

SocGen is the latest heavyweight bank to post lower profits as a result of the impact of the global credit crunch, which negatively affected the French company's investment banking unit by 1.2 billion euros during the second quarter.

On Monday, Europe's biggest bank HSBC posted a 28 percent fall in first-half pretax profit, while U.S. banks Merrill Lynch

and Citigroup posted huge second-quarter losses last month.

BNP Paribas, France's biggest listed bank, reports second quarter earnings on Wednesday.

SocGen is also trying to battle back from the effect of the rogue trading scandal. In January, the bank unveiled 4.9 billion euros of losses which it said were caused by rogue deals carried out by Jerome Kerviel, a 31-year old junior trader at the bank.  Continued...

 
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