By Pietro Lombardi
Societe Generale SA vowed to cut costs in its global markets business after the lender swung to an unexpected loss in the second quarter as it set aside more money for potential loan losses and posted impairments related to the unit housing investment bank operations.
Net loss for the period was 1.26 billion euros ($1.48 billion) compared with a profit of EUR1.05 billion a year earlier, the French bank said Monday.
France's third-largest listed bank by assets stowed away EUR1.28 billion for soured loans, a sharp increase from the EUR314 million reported for the same period last year. In addition, it posted impairments related to its global banking and investor-solutions business, which includes investment banking and asset management: EUR684 million of goodwill impairment and EUR650 million due to impairment of deferred tax assets.
Net banking income, the bank's top-line revenue figure, fell almost 16% to EUR5.30 billion.
Analysts had forecast a quarterly profit of EUR139 million on revenue of EUR5.45 billion, according to a consensus forecast provided by FactSet.