France's second-biggest listed bank has had to trim back much of its previously-booming investment banking activities after taking bigger hits than many of its rivals from the global credit crisis.
The company on Thursday reported fourth-quarter net profit of 221 million euros ($303.4 million), up from 87 million a year earlier and ahead of a consensus forecast of 150 million euros, but below its third-quarter net profit of 426 million euros.
It cut its dividend to 0.29 euros from 1.2 euros. Shareholders can opt for a scrip dividend.
In January, SocGen said it was only expecting a slight profit for the fourth quarter after taking a new 1.4 billion euro hit on risky assets.
The group, which suffered a 4.9 billion euro rogue trading scandal in 2008, has been weighed down by its exposure to toxic assets such as collateral debt obligations (CDOs) although it expected fewer writedowns this year compared with 2009.
2010 is likely to be marked by a sharp rebound in the group's financial results due notably to the gradual elimination of the impact of the financial crisis, SocGen said in a statement. It also expects better results at its domestic and overseas retail banking divisions.
SocGen's fourth-quarter net profit was a fraction of the 1.37 billion euros reported for the same quarter by BNP Paribas
It also paled in comparison to Deutsche Bank's
One Paris-based trader described SocGen's numbers as a bad quality set of figures.
Another trader said that while he was pleasantly surprised by SocGen's earnings, there could be some profit taking on the stock, which closed up 2.4 percent on Wednesday.
SocGen was down 4 pct, underperforming a 0.5 percent fall in the DJ Stoxx European bank sector <.SX7P> and a 0.1 percent dip in France's benchmark CAC-40 index <.FCHI>.
The stock has fallen 14 percent so far this year, compared to a 9 percent fall at BNP Paribas and a 7 percent decline in the DJ Stoxx European bank index.
NEW RUSSIA UNIT
The French group added it had agreed with its Russian partner Interros to combine Rosbank
The new unit would employ 30,000 people and become Russia's fifth-biggest bank by the size of credit portfolio.
We want to create a bank of reference in Russia, Chief Executive Frederic Oudea told French radio BFM.
The investment banking division has been weighed down by writedowns and posted another loss during the fourth quarter.
Like many banks around the world, France's lenders have come under political pressure to make moderate bonus payments. France has also joined Britain in imposing a tax on trader bonuses.
Oudea said SocGen had set aside 250 million euros for its 2009 traders bonuses -- less than the 500 million euros set aside by BNP Paribas.
SocGen is also in the midst of a potentially damaging legal battle with one of its top former fund managers, Jeffrey Gundlach.
Gundlach, who was at SocGen's American fund management arm TCW, had a lawsuit filed against him from TCW after leaving the firm but has since sought to countersue TCW.
(Additional reporting by Juliette Rouillon in Paris; Editing by Marcel Michelson and Jon Loades-Carter)