SocGen FICC and equities revenues declined in Q4

SocGen's equities and FICC revenues increased in 2015, but decreased in fourth quarter due to 'unfavourable' market conditions

SocGen has reported increased revenues for 2015 across its global markets investors services division, but declines in fourth quarter revenues for FICC and equities.

The French bank’s global markets investors services’ revenues increased 6.1% in 2015 totalling almost €6 billion, but fourth quarter revenues declined to just over €1.2 billion, down 8.5% from the same period last year.

SocGen has reported its equity revenues increased 12.3% in 2015 compared to 2014, reaching just over €2.5 billion.

It reported difficult market conditions in H2 of 2015 combined with challenging market conditions affected the revenues. Its fourth quarter of 2015 equity revenues were reported at €447 million, down 31.4%, compared to the fourth quarter in 2014.

Fixed income, currencies and commodities (FICC) accumulated €2.1 billion in revenues, down 7.2% compared to 2014. SocGen described market conditions as “unfavourable”, but performance of flow activities in FICC helped soften the decline in revenues.

The global banking & investors solutions’ operating expenses increased 10.2% in 2015. The increase was explained through an increase in legal and regulatory “constraints”, including the single resolution fund and the systematic tax in the UK – adding €125 million to costs. 

SocGen group’s operating income in 2015 increased 22.5% from €6.9 billion to €8.8 billion compared to 2014. However, fourth quarter revenue decreased significantly by 45% from €1 billion to €547 million. The report explains this is “mainly due to the increase in provision for litigation issues,” as it includes an additional €400 million in the fourth quarter of 2015 as provision for litigation.

Frédéric Oudéa, chief executive officer at SocGen commented on the 2015 results and said: “Revenue growth was buoyant, while maintaining rigorous management of risks and costs.”

Oudéa added: “In the unstable environment expected in 2016, the Societe Generale Group, supported by a successful business model, will determinedly pursue its transformation plan in order to continue to provide its customers with added value and create value for its shareholders.”

The bank listed its focuses for 2016 in the report, with a particular emphasis on “the continued development of international retail banking & financial services’ activities, the control of risks and costs and the development of synergies, notably in global banking & investor solutions.”