Press Release

DBRS Morningstar Confirms Société Générale’s Issuer Ratings at A (high) / R-1 (middle); Stable Trend

Banking Organizations
April 25, 2022

DBRS Ratings GmbH (DBRS Morningstar) confirmed the ratings of Société Générale, S.A. (SocGen or the Group), including the Long-Term Issuer Rating of A (high) and the Short-Term Issuer Rating of R-1 (middle). The trend on all ratings remains Stable. DBRS Morningstar has also maintained the Bank’s Intrinsic Assessment at A (high) and the Support Assessment at SA3. A full list of rating actions is included at the end of this press release.


The confirmation of SocGen’s ratings continues to reflect the Group’s well-established and diversified franchise as one of Europe’s leading banking groups. It also takes into account SocGen’s ability to overcome challenges through rationalisation of its French Retail Banking business, risk reduction in CIB and the planned exit from Russia in Q2 2022 amidst the invasion of Ukraine. In addition, the ratings continue to be underpinned by robust funding and liquidity metrics. The confirmation also incorporates SocGen’s strong capital base, with ample buffers over regulatory requirements and solid total loss-absorbing capacity.

The rating action also reflects SocGen’s continued improvement in asset quality, supported by the Group’s conservative and well diversified risk profile. DBRS Morningstar views that the unprecedented measures put in place by the domestic and European authorities has delayed the formation of NPLs through the COVID-19 pandemic, and uncertainty remains regarding the full effect on asset quality. In addition, DBRS Morningstar notes that the operating environment could be impacted by Russia’s invasion of Ukraine and its implications for supply chains, energy prices, inflation and interest rates.

The Group reported strong profits in 2021, mainly driven by lower cost of risk and higher revenues, supported by an improved economic environment, the reorganisation of the equities business and further rationalisation of the retail operations. Despite higher operating expenses on the back of business recovery, we expect SocGen to continue managing its cost base further down.


An upgrade would occur from a consistent improvement of profitability and efficiency metrics, whilst maintaining the current risk profile.

A downgrade would arise from a sustained decline in the Group’s profitability or a significant deterioration of its capital cushion.


Franchise Combined Building Block (BB) Assessment: Very Strong/Strong
SocGen’s ratings are underpinned by its well-established franchise as one of the leading banking groups in Europe with a strong market position in France, its home market. Reflecting a broad business mix and a significant international presence, the Group services its customers through three business divisions: French Retail Banking (FRB), International Banking and Financial Services (IBFS) and Global Banking and Investor Solutions (GBIS). The Group has undertaken a series of steps to optimise its franchise, such as the planned merger of its French Retail networks Société Générale France and Crédit du Nord, to rationalise its domestic footprint and reduce costs. In addition, SocGen has continued to focus on GBIS’s restructuring plan, reducing RWAs through a rebalancing of the business mix, the reduction of the risk profile and cost optimisation. This restructuring has also been evidenced in asset and wealth management, with SocGen’s sale of Lyxor to Amundi, which generated around 20 bps of CET1. Finally, in Russia, SocGen, had been operating through Rosbank, the second largest foreign banking group. However, following the Russian invasion of Ukraine, SocGen has decided to cease its banking and insurance activities in Russia and signed an agreement to sell Rosbank and its Russian Insurance subsidiaries on April 11, 2022. We expect the closing in Q2 2022.

Earnings Combined Building Block (BB) Assessment: Good/Moderate
After reporting their first loss since the 2008 financial crisis in 2020, SocGen’s profitability bounced back in 2021 with the Group reporting net income of EUR 5.6 billion. This was mainly driven by the cost of risk reverting to pre-pandemic levels at 13 bps in 2021 against 64 bps in 2020. The cost of risk decreased in all business segments in 2021 and is expected to normalise at around 30 bps in 2022. Profits were also driven by a strong revenue rebound in all business lines, especially in GBIS, supported by the improved economic environment, the reorganisation of the equities business and further rationalisation of the French retail operations. Despite higher operating expenses on the back of the business recovery, the higher increase in income led to an improvement in the Group's cost-to-income ratio to 68% in 2021 (2020: 76%) although efficiency continues to remain a key focus for the Group.

Risk Combined Building Block (BB) Assessment: Strong/Good
DBRS Morningstar views SocGen’s risk profile as conservative. DBRS Morningstar notes the lower than average exposure to the corporate and SME sectors compared to other European investment banks. Further to the equity derivatives loss in H1 2020, the Group has reorganised its capital markets activities. The Group has also recently announced it is disposing of Rosbank, its Russian retail and commercial bank, reducing uncertainties driven by geopolitical tensions. Rosbank accounted around for 2% of total exposures. DBRS Morningstar notes the continued improvement in asset quality, reflecting a reduction in non-performing loans (NPL) and tighter origination standards. The share of NPLs in gross outstandings was 3.1% as calculated by DBRS Morningstar at end-2021, down from 3.2% at end-2020, as Soc Gen has not experienced yet any signification deterioration in asset quality as a result of the COVID-19 crisis.

Funding and Liquidity Combined Building Block (BB) Assessment: Strong
SocGen’s funding profile remains strong, with customer deposits representing the major part of the Group’s funding. The exposure to wholesale funding is mitigated by good access to the markets, well diversified funding sources and strong liquidity. The unencumbered liquid asset buffer was EUR 229 billion at end-2021, covering around three times maturing Short-Term debt. The LCR ratio was 131% on average in Q4 2021 compared to 153% at end-2020 and the Group reported that the NSFR was well over the 100% requirement for the same period.

Capitalisation Combined Building Block (BB) Assessment: Strong/Good
DBRS Morningstar views SocGen’s capital as solid, supported by its generally stable underlying earnings generation capacity. The Group’s capitalisation ratios have been generally on an upward trend in recent years. The Group had a fully loaded CET1 ratio of 13.7% at end-2021, up from 13.4% at end-2020. SocGen also reported a fully loaded total capital ratio of 18.8% at end-2021. This provides the Group with ample cushions of around 450 bps and 610 bps over the SREP regulatory requirements for CET1 and Total Capital, which will allow SocGen to absorb potential headwinds, such as the sale of Rosbank, which will have a negative impact of around 20 bps on the CET1 ratio. The fully loaded Basel 3 leverage ratio was 4.8% at end-2021. The Group resumed dividend payments to its shareholders in 2021, with a proposed dividend payment of EUR 2.75 in cash and through a buy-back programme of EUR 915 million, of which EUR 470 million has already been completed.

Further details on the Scorecard Indicators and Building Block Assessments can be found at

A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework can be found in the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at

All figures are in EUR unless otherwise noted.

The principal methodology is the Global Methodology for Rating Banks and Banking Organisations (19 July 2021) Other applicable methodologies include the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings (3 February 2021) and DBRS Morningstar Criteria: Guarantees and Other Forms of Support (April 4, 2022)

The sources of information used for this rating include Morningstar Inc. and Company Documents, Société Générale Q4 2021 Report, Société Générale Q4 2021 Press Release, Société Générale Q4 2021 Financial Data, Société Générale Q4 2021 Presentation, Société Générale 2021 Universal Registration Document. DBRS Morningstar considers the information available to it for the purposes of providing this rating to be of satisfactory quality.

With respect to FCA and ESMA regulations in the United Kingdom and European Union, respectively, this is an unsolicited credit rating. This credit rating was not initiated at the request of the issuer.

With Rated Entity or Related Third-Party Participation: YES
With Access to Internal Documents: NO
With Access to Management: NO

DBRS Morningstar does not audit the information it receives in connection with the rating process, and it does not and cannot independently verify that information in every instance.

Generally, the conditions that lead to the assignment of a Negative or Positive trend are resolved within a 12-month period. DBRS Morningstar's outlooks and ratings are under regular surveillance.

For further information on DBRS Morningstar historical default rates published by the European Securities and Markets Authority (ESMA) in a central repository, see: DBRS Morningstar understands further information on DBRS Morningstar historical default rates may be published by the Financial Conduct Authority (FCA) on its webpage:

The sensitivity analysis of the relevant key rating assumptions can be found at:

This rating is endorsed by DBRS Ratings Limited for use in the United Kingdom.

Lead Analyst: Arnaud Journois, Vice President – Global Financial Institutions Group
Rating Committee Chair: Ross Abercromby - Managing Director - Global FIG
Initial Rating Date: July 26, 2001
Last Rating Date: April 27, 2021

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