The French investment bank reported strong client activity in listed products in Q1 2022.

Société Générale has posted revenues of €7.3 billion for the first quarter of 2022 – an increase of 16.6% year-on-year (YoY).

In a volatile environment, the global markets business encountered its best quarter since 2009, driven by good client activity and the rise in rates. Revenues amounted to €1.8 billion, up 21% compared to the prior year quarter.

Equities continued to be strong, supported by high client demand and a strict monitoring of our risks - Claire Dumas, CFO

Revenues in the equity activity, at €1 billion, were up 20% YoY, with particular strong client activity in listed products and prime services. The structured products portfolio remained stable, with good risk management.

“This strong quarter validates our strategic roadmap and the quality of its execution,” said Claire Dumas (pictured), group chief financial officer, speaking during the presentation of the results on 5 May.

“Equities continued to be strong, supported by high client demand and a strict monitoring of our risks.”

Fixed income & currency (FIC) activities posted substantially higher revenues at €767m (up 21.7% compared to Q1 2021) in a favourable market environment across all asset classes and for rates in particular.

Société Générale issued 423 publicly offered structured products on the primary market (across nine different jurisdictions) in the first quarter of 2022 (Q1 2021: 801 products).

The highest activity was seen in the bank’s home market France where it collected an estimated €2.4 billion from 196 products – an increase of 135% in sales compared to the prior year quarter (Q1 2021: €1 billion from 259 products). Ninety-six percent of the French products were autocalls while more than 70% of the volumes came from structures linked to a single index, of which the proprietary SBF Top 50 ESG EW Decrement 50 Points (34 products) was the most frequently used.

Other European countries were the bank increased its activity were Germany (102 products) and the UK (21 products) where  issuance was up 65% and 50%, respectively, YoY.

Outside of Europe, SG was the manufacturer behind 86 products that were targeted at private banking clients in Taiwan and 13 products that were offered via local security houses in Japan.

The French group was the number two provider of listed leverage products (by issuance) in Q1 2022, behind J.P. Morgan only, according to SRP data. The bank issued more than 150,000 turbo certificates in the quarter, an increase of 47% compared to Q1 2021 (102,104 turbos). Most turbos were targeted at investors in Germany (130,946). Other countries where its turbos are marketed include France (13,160), Belgium (4,718), and the Netherlands (4,048).

In Hong Kong SAR it issued 1,461 warrants and callable bull bear certificates in the quarter (Q1 2021: 1,816).

Private banking activities were transferred to French retail banking in Q1 2022. The scope included France and international operations as well as the activities transferred at the time of the disposal of Lyxor. The private banking business enjoyed strong commercial activity in all the regions. Assets under management totalled €150 billion, up eight percent from Q1 2021. Net inflows were €2.7 billion, despite the volatility of the financial markets, while net banking income totalled €322m in Q1 2022, up 21.2% versus Q1 2021.

On 11 April 2022, Société Générale signed an agreement to sell Rosbank and its Russian insurance subsidiaries. This operation is expected to be closed in the few coming weeks. The impact of the disposal of Rosbank and the Russian insurance activities on the group's common equity tier 1 (CET1) ratio is expected to be around -20 basis points.

As of 31 March 2022, the group’s consolidated balance sheet included debt securities issued of €135.4 billion (end-December 2021: €135.3 billion) and an outstanding for hedging derivatives of €17.8 billion (€10.4 billion).

The parent company’s 2022 long term funding programme includes €19 billion of structured notes issuance and €20 billion of vanilla debt. As of 26 April 2022, €19.7 billion had been raised (€13.6 billion of vanilla funding and €6.1 billion of structured notes issuance).

Funding conditions were competitive, and the average maturity was 5.9-years.

Click the link to read the full first quarter 2022 results and presentation.