Societe Generale delivered record first-half profits and unveiled a fresh 1.5 billion euro share buyback on Thursday, as chief executive Slawomir Krupa’s turnaround strategy continues to gather momentum at France’s third-largest bank.
Record Numbers Across the Board
The French lender reported second-quarter net income of 1.79 billion euros, a record for any single quarter in the bank’s history, translating into a return on tangible equity of 12.2%. For the first half of the year, group net income reached 3.49 billion euros, also a record, marking a 13.9% increase compared with the same period in 2025 and pushing first-half ROTE to 12.0%.
Second-quarter revenue climbed 4.5% year-on-year to 7.1 billion euros, while costs fell 4.1% over the same period, driving the cost-to-income ratio down to 58.6%. Cost of risk for the quarter came in at 27 basis points, comfortably within the bank’s guidance range of 25 to 30 basis points for the year. Across the full first half, revenues rose 2.4% to 14.2 billion euros, in line with the bank’s annual target of growth above 2%, while costs fell a sharper 5.0%, outperforming the bank’s own goal of roughly 3% cost reduction.
French Retail Banking Leads the Turnaround
Much of the strength came from Krupa’s long-running effort to revive SocGen’s French retail, private banking, and insurance operations, which posted revenue growth of 12.6% in the second quarter to reach 2.55 billion euros. Net interest income within that division surged 14.9% compared with the same period last year. Private banking assets under management and life insurance outstandings both climbed to record highs, up 10% and 11% respectively year-on-year, underscoring the scale of the recovery in a business line that had weighed heavily on the bank’s results in prior years.
A Buyback Backed by Upgraded Targets
Buoyed by the strong results, SocGen’s board approved an extraordinary share buyback of 1.5 billion euros, expected to launch on August 3, 2026 at the earliest, which would reduce the bank’s core capital ratio by roughly 39 basis points. The move reflects the bank’s growing confidence in its capital position and its ability to return excess capital to shareholders while still funding growth initiatives across its business lines.
Alongside the buyback, SocGen also declared an interim cash dividend of 0.751 euros per share, a 23% increase compared with the previous year’s interim payout. The bank additionally raised its full-year profitability target, lifting its 2026 return on tangible equity goal to approximately 11%, up from its previous target of above 10%, while also upgrading its annual cost reduction target to roughly 4% from the earlier goal of about 3%.
A CEO’s Strategy Paying Off
The results mark a significant milestone in Krupa’s broader turnaround effort at SocGen, which has focused heavily on disciplined cost management, a revival of the bank’s core French retail franchise, and steady improvement in capital returns to shareholders. Since taking the helm, Krupa has repeatedly emphasized combining strong revenue growth with strict cost and risk management, a formula that has now delivered back-to-back record quarters and helped push SocGen shares to among the better-performing bank stocks in Europe over the past year.
Some Soft Spots Remain
Despite the headline strength, not every part of the bank’s business has fired equally. SocGen’s investment banking and trading operations have faced tougher conditions in recent quarters, with fixed income and currencies trading revenue coming under pressure even as overall group performance has remained resilient. The bank’s digital banking arm, BoursoBank, also continues to face intensifying competition from newer entrants like Revolut in the French market, even as it continues attracting new customers at a steady pace.
What Comes Next
With the board meeting having taken place on July 29 under the chairmanship of William Connelly, and record first-half results now locked in, attention is turning toward SocGen’s next strategic update, expected to detail the next phase of the bank’s transformation and provide further clarity on capital allocation priorities. For now, the record profits and expanded shareholder returns suggest Krupa’s turnaround strategy continues to deliver, even as the bank works to translate strength in its retail and private banking franchise into more consistent performance across its investment banking operations as well.
