Société Générale (GLE) Goldman Sachs 29th Annual European Financials Conference summary

Strategic priorities and transformation

• Focused on setting strong fundamentals, targeting a 13% CET1 ratio, and streamlining risk and business perimeter to enable growth and returns.

• Achieved 13.4% CET1 ahead of schedule, mainly due to successful and timely execution of divestment programs.

• Emphasized a cohesive executive team and cultural shift toward accountability and prioritizing the bank's interests.

• Identified BoursoBank as a significant asset with long-term potential in the French retail market.

• Transformation efforts are supported by a stable core business and a clear focus on efficiency and cost discipline.

Capital return and shareholder distribution

• Increased dividend payout policy to 50% of profits for 2024 and beyond, balancing growth and capital retention.

• Plans to maintain a split between cash dividends and buybacks, with potential for a higher cash component if profits rise.

• Excess capital above 13% CET1 will be returned to shareholders, pending regulatory clarity on FRTB implementation.

• Board is prepared to distribute capital once FRTB postponement is confirmed, as organic capital generation exceeds regulatory needs.

• No need to wait until 2026 for formal decisions on buybacks; process depends on regulatory approval timelines.

Cost management and efficiency

• Shifted to net cost evolution guidance, targeting a 1% cost reduction in 2024 after disposals.

• Q1 2024 saw a 4.4% cost reduction, but this is not expected to be recurrent; full-year target remains at -1%.

• Aims for a 66% cost-to-income ratio by end-2024, moving to 60% by 2026, with ongoing investments and cost projects.

• Revenue growth expected from BoursoBank and stabilization of mortgage margins, with further cost synergies from mergers and IT initiatives.

• Long-term goal is to achieve 9%-10% return on tangible equity, with further cost-to-income improvements possible beyond 2026.