PARIS, March 1 (Reuters) - Small-to-medium-sized businesses in France are facing a grim 2013 marked by a stagnant economy, a lack of investment and declining profits, a top executive at French bank Societe Generale said on Friday.
Default rates for SMEs are on the rise as France's economy drifts out of kilter with its powerhouse neighbour Germany, a trend that led to a spike in losses on SocGen's French corporate loan book at the end of 2012.
SocGen's head of retail banking in France Laurent Goutard said the situation remained gloomy.
"We don't foresee an improvement in 2013 ... Default rates are rising and we are trying to manage the situation," Goutard told reporters at a presentation on SME financing.
"While there is no 'credit crunch', we cannot lend to everyone ... If we have to say 'no' to a client's proposal, we must say it as soon as possible and clearly explain why."
Bank of France data shows annualized corporate default rates were up 1.4 percent at the end of November 2012, with provisional figures for the year-end showing a further increase, to 2.3 percent.
Goutard said there were other ways to support SMEs beyond lending, including cash-management solutions such as factoring that allow companies to sell their invoices at a discount for cash.
He also said that SocGen would work with French state entities such as the public investment bank, which is seeking to support businesses with 42 billion euros in financial aid part-funded by state bank Caisse des Depots.
SocGen's retail bank, which manages lending to small businesses, had 176.1 billion euros ($230.22 billion) of SME loans on its balance sheet at the end of 2012. ($1 = 0.7649 euros) (Reporting by Lionel Laurent; Editing by Helen Massy-Beresford)