OREANDA-NEWS. May 23, 2014. As recently stated by Societe Generale Group on various occasions, SG Russia (Rosbank, Delta Credit Bank, Rusfinance Bank, Societe Generale Insurance, ALD automotive and their consolidated subsidiaries) maintained a satisfactory commercial result in Q1 2014. Net banking income rose by 6.4% in Q1 14 vs. Q1 13 to EUR 296 million in Q1 14, while costs remained under control (+5.1%).

Outstanding loans in Q1 2014 were up +6.2% vs. end-March 2013 (at EUR 12.5 billion, driven by the increase in the individual customer segment). Outstanding deposits for the period enjoyed robust growth (+12.8% to EUR 8.6 billion overall) over the same period. Rosbank’s loan/deposit ratio continued to improve (104% at end-March 2014 vs.115% in December 2013).

All in all, the SG Russia operation made a EUR 7 million contribution1 to Group net income in Q1 14 before goodwill write-down. The decision to write-down its goodwill on Russian activities is not linked to any operating loss. This goodwill impairment, which has no impact on the Societe Generale group's solvency ratios, is the result of an accounting obligation to periodically reassess the value of a company's assets to see how its actual value compares to its book value.

On April 11th, 2014, the Group confirmed its long-term view of the potential of the Russian banking market and its commitment, with the purchase of minority interests amounting to 7% of Rosbank’s capital (thus taking its stake in its subsidiary to 99.4 %.).

On May 13th, Societe Generale presented its 3-year development strategy for Russia, which reinforces the capacity to achieve satisfactory profitability in 2016 in a scenario of gradually easing tensions. Russia will remain one of the main growth drivers in the next three years and SG Russia will deliver a revenue growth of 7% per year, a ROE of 14% in 2016, and a contribution of around 5% to the net result of Societe Generale in 2016.