* Disclosures made in earlier analyst meeting
* Bank issues statement after Reuters story
* Shares trim early heavy losses
* Sounds optimistic note on liquidity target
(Recasts with SocGen statement, AMF comment)
By Christian Plumb
PARIS, Jan 16 Societe Generale said on
Wednesday that its quarterly earnings would be hit by hundreds
of millions of euros of one-off charges.
The bank said it would write down an unspecified portion of
384 million euros ($510.58 million) in goodwill on its balance
sheet for brokerage Newedge in the fourth quarter, and would
take a charge on its own debt of more than 605 million euros.
SocGen shares fell as much as 4.9 percent following a
closed-door briefing late on Tuesday by the French bank's
outgoing Chief Financial Officer Bertrand Badre, who analysts
said told them about the write-downs and the possibility of
rising loan losses.
The bank later confirmed Badre's comments to Reuters and the
stock trimmed its losses to 2.8 percent by the close.
"The message is bearish for Q4, with large one-offs ...
probably resulting in a net loss," Cheuvreux analyst Cyril
Meilland wrote in a research note downgrading the stock to
"underperform" from "outperform."
Meilland added that rising loan-loss provisions in French
retail banking and a lack of recovery in Russia and Romania were
also likely to have squeezed earnings in the final three months
One analyst who did not attend the briefing, said the
impairment from Newedge, a joint venture with Credit Agricole
, were previously known but described the figures for
the own-debt charge as "enormous".
Other analysts, who attended the dinner with Badre - who is
leaving in March to become CFO of the World Bank, said the
message was also gloomy for 2013, where a stagnant French
economy is likely to increase loan losses.
"The feedback provided was negative in our view, mainly with
respect to a distinct deterioration in French retail cost of
risk," Espirito Santo analyst William Davison wrote in a
research note, referring to bad debt provisions.
On a positive note SocGen said it expected to reach a 100
percent liquidity coverage ratio this year after a decision by
global regulators earlier this month to give banks more time and
flexibility to build cash reserves.
'A BIG DILEMMA'
Some analysts criticised the bank's selective disclosure of
the financial data.
French market regulations require listed companies to
provide "equal and simultaneous access in France" to any
information made available to investment analysts, according to
the website of the AMF stock market watchdog which said it was
in contact with SocGen and was "following the matter closely".
"It's a big dilemma but it's done almost every day, at least
with the French banks," one Paris-based analyst said when asked
about the analyst meeting, which he said took place at Cafe
Lenotre, an upmarket venue on the Champs Elysees.
Colette Neuville, president of minority shareholder defence
group ADAM, said companies were definitely barred from providing
outlooks during the "blackout period" starting a month to 15
days ahead of the publication of results but that such
disclosures were otherwise "a grey area".
SocGen declined to comment on the disclosure issue.
Mirabaud Gestion AM General Director Marco Bruzzo said
overall SocGen's message was "globally optimistic but that the
economic environment was still challenging."
He said the bank's shares had rallied strongly and that some
investors could be taking profits. As of Tuesday's close, they
had risen 18 percent since the start of the year.
($1 = 0.7521 euros)
(Reporting by Christian Plumb; Additional reporting by Steve
Slater, Lionel Laurent and Blaise Robinson. Editing by Elaine