Ladies and gentlemen, welcome to the presentation of the Fourth Quarter and Full Year 2024 Results of the Société Générale Group. I will now hand over to Mr. Slawomir Krupa, Chief Executive Officer. Sir, please go ahead.
Good morning, everyone, and thank you for joining us today. I'm very pleased to be here with you to review our performance and achievements for the past year. But I'm also eager to share with you our future ambitions and the targets we have set for the year to come. Of course, I first want to welcome Leo, our new CFO, who joined the call for the first time. Leo is a tremendous addition to our leadership team, and we have been working together for about a month already, and I'm very happy to have him on the team. 2024 was the first full year for the management team appointed in 2023. At our CMD, we set a clear path for the company, and since then, we've been relentlessly focused on the precise execution of our strategy.
We are committed to building strength and sustainability through higher capital, strategic focus, and improved profitability. We have been successful in this first step towards our 2026 goals. Last year, we exceeded every single one of our financial targets. Our revenues were up 7%, well above our 5% target, and this is thanks to solid performance across all our businesses, but three in particular: GBIS, Ayvens, which posted higher revenues and increased margins, and International Retail we also had a first rebound performance French Retail, and for us, the winning equation is the sum of strong revenue growth plus strict discipline in cost management and risk management. Our costs are stable compared to 2023, and we reached a cost-to-income ratio of 69% for the year. That's nearly a five-point improvement over last year.
At 26 basis points, the cost of risk is at the low range of our through cycle guidance, and this reflects the quality of our origination and the strength in terms of risk management. All this leads to a sharp improvement of our ROTE, reaching 6.9% for the year, an increase of 2.7 percentage points compared to the full year 2023. We succeeded at streamlining our business portfolio with 13 disposals. In fact, we just closed last week the disposal of our private bank in Switzerland, and these have generated positive outcomes in terms of price and buyer's quality. In terms of capital, we increased our CET1 ratio by around 20 basis points throughout the year. Today, we stand at 13.3%, and not only is that a strong position, but it is also well ahead of plan.
Based on the strong delivery of the financial performance, the board has decided to propose a total distribution of EUR 1.7 billion, up 75% compared to 2023, and this is equivalent to EUR 2.18 per share, and here's how it will be split: a dividend of EUR 1.09 per share paid in cash on May 28, and a share buyback program of EUR 872 million, i.e., EUR 1.09 per share. This slide is more a visual representation of how our performance improved over the last year across all our targets. As you can see, and as we promised, we're in a much stronger position this year. Before turning the page on 2024, let's look a little bit deeper at our business performance. French retail benefited, of course, from the rebound of the NII.
The last time we saw the negative impact of the short-term hedges was in Q2 of last year, and we've also implemented a new operating model throughout the combined networks. This is increasing our commercial performance and our ability to gain market share. An example of this is our market-leading fundraising performance in investment products and life insurance. BoursoBank continued to lead the market in client acquisition with 1.3 million new clients, while reaching profitability for a second year in a row. Once again, GBIS posted an exceptional performance in 2024, with over EUR 10 billion of NBI and a 18.4% ROTE. This was driven by Global Markets and Transaction Banking. At the same time, we implemented an asset-light model in our Global Banking division. It supports both our origination capacity at constant capital and our quest to improve profitability even further.
Within international retail, KB and BRD are continuing to show strong commercial performance, and lastly, Ayvens improved its margins steadily over the year, and this is, as you know, the heart of the value creation in this business. Thanks to this strong performance and to our capital trajectory, which is well ahead of plan, we have decided to increase the 2024 payout ratio to 50%, with a balanced mix between cash dividends and share buybacks. Once again, we're proposing a total distribution of more than EUR 1.7 billion, up 75% versus last year. It includes a cash dividend of EUR 1.09, up 21% versus last year, and a share buyback of EUR 872 million, more than double what it was in 2023.
The cash dividend is subject to the AGM approval on May 20, 2025, and we have already obtained the ECB approval for the share buyback program, which will be launched as soon as next week. In addition to that, the board has decided to change our policy regarding distribution. From now on, the payout ratio will be 50%, with a balanced mix between cash dividends and share buybacks. And also, as we established at the 2023 Capital Markets Day, we will proactively manage our sustainable excess capital above 13% CET1 ratio in the best interest of shareholders, with a mix of exceptional distribution and profitable disciplined growth. Now, against that strong 2024 backdrop, let's move on to 2025. I think we all heard the expression, "If it ain't broke, don't fix it." And actually, I have a different take on that. I believe if it's working, keep improving it.
That means for all our businesses doing even better in terms of commercial momentum, client satisfaction, and disciplined capital allocation. These initiatives apply across the board in BoursoBank, GBIS, French retail, Ayvens, and international retail all the same. Our continued focus in these areas and execution discipline will deliver superior business outcomes in terms of profitable growth. It's always been important to me that we say what we do, and we do what we say. Thanks to our strategic plan, we've made substantial progress, and we're going to build on that. The 2025 targets we are setting are fully in line with our commitment to have a linear improvement in profitability towards our 2026 targets.
For 2025, we have an NBI growth above 3% versus last year, excluding the impact of disposed assets, a net cost decrease of more than 1%, excluding the impact of disposed assets, a cost-to-income ratio below 66%, a cost of risk within the 25-30 basis points range, and a ROTE above 8%. Key drivers for 2025 will be on the revenue side. The commercial momentum and our business investments paying off will more than offset an expected normalization trend in global markets, which should be at the higher end of the guidance, around EUR 5.5 billion, and within Ayvens in terms of the UCS prices normalization. On the cost side, we remain committed as ever and confident in our ability to decrease our cost base further this year by more than 1%, and hence this additional estimate that we are giving you today. We've talked about revenue growth.
We've talked about cost control. All these contribute to value creation through a higher operating leverage, and they will create a substantial lift to our GOI. It will increase by 6% and even by 11%, excluding asset disposals. This is the winning formula. This is the equation that will continue to work for us. Improved efficiency with a three-point decrease in our cost-to-income ratio from 69% to below 66%, plus strict origination and strong risk management with a cost of risk within the 25-30 basis points range, equals a ROTE above 8% for the year. It is our goal to deliver steadily a consistent and predictable improvement on this number and in terms of our overall performance. I will now leave the floor to Leo, who will comment on the Q4.
Thank you, Slawomir, and good morning, everyone. I'm very excited to be here after Slawomir, and I look forward to engaging openly with all of you very soon. Moving now on with the presentation, on slide 12, we can find the key drivers for revenue and cost evolution in Q4 2024. As can be seen in the left chart, we had a strong 11.1% increase in group revenues in this quarter. The evolution is mainly explained by the growth of the revenues in French retail, private banking, and insurance, with a strong rebound on NII, actually 36% up versus Q4 2023, as well as by high revenues in Global Banking and Investor Solutions, benefiting from conducive market conditions, in particular on equities.
Additionally, the group deployed a strict risk deployment on costs, as total costs are down by 1.5% in Q4 2024 versus the same quarter last year, despite the inflationary perimeter impact of Bernstein. Restated from that, we lowered our cost by around 2%. Regarding cost of risk on slide 13, in Q4 2024, the cost of risk is limited to 23 basis points, down from 27 basis points in Q3 2024. All in all, for the full year 2024, cost of risk amounts to 26 basis points. This is at the lower end of our guidance. The cost of risk for the quarter, mostly composed of stage three provisions, amounts to EUR338 million, down from both Q3 2024 and Q4 2023 levels. In parallel, total standing provisions on stage one and stage two assets remain high at EUR 3.1 billion.
These amounts are stable versus the 30th of September and lower versus Q4 2023 due to perimeter effects. This is mainly due to the disposals completed in Morocco and Madagascar. On the other hand, S2 provisions represent 4.5% of loans classified in stage two. The quality of assets, therefore, remains strong, with NPL ratios at 2.81% in Q4 versus 2.95% in the same quarter in 2023. Finally, the net coverage ratio remains solid at 81% at the end of the year. Let's now move on to capital on slide 14. The CET1 ratio is at 13.3% for Q4. This is around 310 basis points above the MDA buffer. Through the year, we have managed to increase our capital by 20 basis points.
Now, with this strong ratio, it is important to mention that the capital phase build-up is behind us, as we will be post-Basel IV implementation above 13% throughout all quarters in 2025. Focusing now on the evolution in the quarter, the 10 basis points increase is explained from left to right in the chart, first by a strong organic capital generation throughout earnings, representing 11 basis points after the accrual of the 50% payout. We had 20+ basis point impacts driven by the disposals, mostly led by Morocco. We had an impact of 15 basis points from regulatory headwinds, which had been expected and guided for previously. And then we had some minor other impacts, which account for - 5 basis points. This strong ratio testifies to our strong discipline and sound management throughout the year and allows us to improve our distribution policy, as Slawomir explained previously.
As you can see on the bottom right-hand side of the slide, all other capital ratios are comfortably well above their requirements. Let's review the liquidity profile of the group in slide 15. Société Générale has a strong liquidity profile, with an LCR ratio standing at 156% at the end of the year and an NSFR ratio at 117, both well above regulatory requirements. Liquidity reserves stand at EUR 315 billion at the end of the year, with 61% being cash at central banks. Regarding the funding plan, we've already completed 47% of it as of the end of January. We do have good access to liquidity in all currencies on the back of strong long-term ratings from all agencies. The deposit base remains granular and diversified, and it grew by around 1% compared to Q3 2024. And finally, the loan-to-deposit ratio of the group stands at 75%.
In slide 16, we show a summary of the P&L for the group for the year, which we will cover in more detail in the following slides. Let's move now to the business performance, starting with French retail on slide 18. This quarter, the market environment has been in a wait-and-see mode, particularly on loans. Loans outstanding decreased by 4% compared to last year, although when excluding state aid plan, this is the PGEs, loans are down 2.5% versus Q4 2023. Corporate loans, excluding the PGEs, are now growing versus Q3 2024, and there is a strong commercial momentum in the individual client segment as well. The deposits are decreasing by 1% versus Q4 2023, as there is a shift to investment products.
Indeed, on the savings front, we reached new record highs in both private banking AuMs, standing at EUR 154 billion, and life insurance outstandings at EUR 146 billion, thanks to continued strong inflows in both cases. Lastly, we see a steady increase in personal protection and P&C premia, up by 5% at constant perimeter this quarter versus the fourth quarter of last year. Now, focusing on BoursoBank, our digital bank is above the guided targets with almost 7.2 million clients at the end of the year. BoursoBank confirmed its profitable growth, decreasing its cost per client by 17% versus 2023, whereas the client base increased by 22%. For the second year in a row, BoursoBank posts a net positive result in 2024, despite onboarding new clients at a high pace, with 1.5 million new customers in the year, of which 461,000 were achieved in Q4.
The low churn rate at 3%, which is still decreasing, on the back of a full-fledged banking offer and being among the leaders in terms of digital proposition and number one in client satisfaction. On the commercial performance front, Assets under administration commands a continued steady growth, as they are up more than 15% versus last year, at EUR 64 billion in Q4 2024. At retail pillar level on slide 20, the robust performance of the various activities in France led in Q4 2024 to a strong increase in revenues, + 15.5% versus the same period last year, while costs are down by 1%, and cost of risk is also decreasing to 20 basis points. This translates into a net income of EUR 360 million for the quarter, equivalent to a ROTE of 9.1%.
When we go to the full year, revenues are up 7.5%, while costs are down 1.8%, thanks to strict cost control, and cost of risk is up to 30 basis points. While this results in a net profit of EUR 991 million for the year, which translates into a ROTE of 6.3%, up from the 3.9 figure last year. Turning now to Global Markets and Investor Services, on slide 21, we have had another strong quarter with revenues up 9.8% and 4.5% in the full year basis. On Global Markets, this is the best quarter ever, versus Q4 ever, with revenues up 9.5% at more than EUR 1.3 billion, which is led by another strong performance in equities, up 10% versus an already very high Q4 2023. This increase was supported by conducive market conditions for equities, resulting in a record Q4, which led also to a record year for this activity.
On FIC, revenues are up 8.8% in the quarter, benefiting from good client engagement following the US elections and its impact on rates and currencies. Lastly, with regards to Securities Services, revenues are up 12.4% on a reported basis versus Q4 2023, or 5%, excluding the positive equity participation impact in this quarter last year. This is due to the continued strong fee generation and robust business momentum in fund distribution, both in France and Italy. Let's move now to slide 22. Financing and Advisory delivered another strong quarter, very close to the record level for a Q4, back in 2022. With revenues at EUR 964 million, this is up 16.7% versus Q4 2023. On a yearly basis, they are up 5.8% at EUR 3.6 billion, which is a record year for this business.
Global Banking and Advisory delivered strong performance with revenues up 13.7% versus Q4 2023, notably thanks to strong momentum in structured finance and a strong rebound in M&A. This is the second best quarter for this activity, close to the record in Q4 2022. On a yearly basis, revenues are up 3.2%. Finally, in transaction banking, revenues are up 26.1% in Q4 2024, thanks to strong commercial momentum across the board, with a high level of fees, especially in correspondent banking. On a yearly basis, this is the best year for the business again, with revenues up 13.9% versus 2023. Overall, this is another remarkable quarter for GBIS, with a 12.4% increase in revenues versus Q4 2023, reaching EUR 2.5 billion in the quarter, or 5% on a yearly basis, another record year since 2009, with NBI above the EUR 10 billion mark.
Costs have been very well contained, being up only 2.7% in the quarter, while down 3.6% in the year, translating into strong positive jaws, both on a quarterly and a yearly basis. Overall, GBIS delivered a very strong quarter and a very strong year, with a net contribution of €627 million, or EUR 2.8 billion in the year. Finally, the ROTE of this pillar reached 18.4%, which is an increase of 3.6 percentage points on 2023's profitability. Moving now on to international retail. For this pillar, the commercial activity posts a good momentum across the board, with outstandings up on loans by 3% and deposits by 4% at constant perimeter and exchange rates. In Europe, loans are up by 5% and deposits by 4% versus the same quarter last year at constant exchange rates in both countries.
In Africa, the business activity is reviewed, with stable loans and a 4% growth in deposits versus Q4 2023 at constant perimeter and exchange rates, both largely on the retail side. Overall, revenues on the international banks improved by 3% versus Q4 2023 at constant perimeter and exchange rates. Turning now to Mobility and Leasing Services. Ayvens shows a strong performance this quarter, with revenues sharply up 16% versus Q4 2023 in reported and 2%, excluding non-recurrent items, notably the negative impacts linked to mark-to-market of the hedging portfolio that took place in the last quarter of 2023. Margin revenues are increasing by 12% versus last quarter, reaching 541 basis points, reflecting commercial action initiatives launched this year to increase profitability. UCS results per vehicle continue to gradually normalize, as expected.
In Q4 2024, it amounts to EUR 1,267 versus EUR 1,420 in the last quarter, well within our guidance, which was from EUR 1,100-EUR 1,600 for the year. In Consumer Finance, revenues are down year- on- year, but they're stabilizing compared to the previous quarter, while we observe a recovery in margins on the new production. All in all, the contribution to the group net income from this pillar remains high, at EUR 314 million in Q4 2024, or 10.5% up versus Q4 2023, which is equivalent to a ROTE of 12% versus 11% in the same quarter last year. Overall, versus Q4 2023, revenues are up, driven by the strong performance in Ayvens, as I just explained, and costs are down, reaping the benefits from strict discipline across the pillar. Over 2024, while revenues are almost stable, the pillar's net income comes at EUR 1,270 million, down by 21% versus 2023.
This leads to a decrease in ROTE to 12% versus the 17% of last year, mostly reflecting the higher cost to achieve due to LeasePlan integration this year, which was well-guided. To conclude on the financial performance, let's move to slide 27 with the Corporate Center. The revenues of the Corporate Center comprise recurrent impacts related to the management of the structural risks and excess liquidity of the group, while the net profit and losses from other activities are mainly impacted by the various ongoing disposals. In Q4 2024, the Corporate Center posts a net result of EUR 261 million. Last, please note that the Corporate Center will, as per 2025 onwards, allocate 13% of capital to businesses in line with our 13% capital target instead of the 12% which is currently being allocated. I will now give the floor back to Slawomir.
Thank you, Leo.
We have an established ESG strategy from which to step forward. Our new EUR 500 billion sustainable finance target is aligned with our decarbonization ambition, in which we have now alignment targets on 10 sectors covering 70% of our corporate clients' financed emissions. We are investing in the future with innovative solutions and partnerships, and we have begun executing on the group's EUR 1 billion transition investment. Core to our strategy as a responsible employer, we continue to advocate for an inclusive culture and remain committed to our ambitions in diversity, equity, and inclusion, which include, for instance, the progressive allocation of a EUR 100 million gender pay gap envelope. We will conclude with our usual slides. The message is simple. We have a clear plan. We have precise targets. We execute. We deliver, and we will deliver further. Thank you very much.
And let's now start the Q&A with our usual kind request to stick to two questions per person. The floor is yours.
Thank you, sir. Ladies and gentlemen, if you wish to ask a question, please press star and one on your touch-tone telephone. Please ask your question in English. We have the first question from Tarik El Mejjad of Bank of America.
Hi, good morning, everyone, and congrats for these results. Welcome, Leopoldo. What's a great way to start. So now, I think on the French retail, it's clear that you have turned the corner in comments in the presentation on this division. We're very clear. So I'll focus my two questions on capital and capital distribution, which I think is your next leg of the re-rating story, to be honest.
First of all, as we discussed a few times, Slawomir, if I do the maths on capital trajectory, so if I include all the proceeds from the disposals already announced and yet to close in first half, I take pro forma Basel IV, including FRTB. That should already position you at above or at 13% Basel IV CET1 in Q2 results. Would that seem realistic that we expect more share buyback distribution from second half this year? I think your comments in slide six say it all. Proactive management, sustainable excess capital above 13% Basel IV in the interest of shareholders, distribution shareholders, and profitable discipline growth. I mean, for me, the interest of investors at these multiples is share buyback. So I would like to hear you from this. Will you formalize actually the distribution policy more precisely with that aspect? Second question is still on capital.
I think there are two divisions that have, in my sense, non-satisfactory returns, financing and Ayvens. I don't think this is mainly due to capital-intensive nature. So for the financing, you have Brookfield projects, more securitization. So can you tell us what more you can do there to control RWAs? And for Ayvens, sorry if it's a provocative question, but you mentioned that it will add value and you will do something in there. What kind of management actions should we expect? Something more milder, similar to the Brookfield deal on the financing, or should we think further of potentially selling a stake to deconsolidate and have non-controlling stake, which will release a lot of pressure on your balance sheets? Sorry for the long questions. I'm interested to hear your answers. Thank you.
Thank you, Tarik.
It seems to me that you squeezed in a third one here, but very smartly. So let's roll with it. On the capital, I think let's split it in two, obviously related but separate topics. One, the statement we're making today very clearly, and which you know very well, we have made in the past, but we're making it more formally, so to speak, is that our target is 13% in a sustainable way. Of course, we don't want any roller coaster there, but our target is 13% and not more. So we're making that very clear that above that, anything above that in a sustainable way will be proactively managed through both exceptional distribution and reinvestment in growth. So that's the first piece. The second piece that you're more specifically aiming at is the timing and how we're going to formalize this further down the road.
Let me put it this way. As soon as some of the still remaining uncertainties, like FRTB is the perfect example, right? I mean, it's 35 basis points. Right now, we have no other option than to position this consumption of capital at January 26. Yeah, there's a lot of chatter. There's a lot of seemingly willingness to postpone this maybe by another year. Right now, it's not. So right now, it's in the trajectory. So as soon as we get some more clarity on things like that, we would be able to be even more precise in terms of both whatever quantum timing and specifics. And as far as the buybacks are concerned, well, from a theoretical standpoint, I can only agree with you. And we are, as you know, trying to be rational about our decisions.
In terms of the two divisions that you mentioned, I think in terms of the global banking and Financing and Advisory, the idea is to accelerate what we're doing right now. Brookfield is one piece, but of course, with EUR 4-5 billion under management versus the size of our business there, at this point in time, it's a very interesting tool, but it's not game-changing at this point. It's moving forward, as you know, an interesting investment, an interesting setup. On the substance, we are committed, and you see this in the way we manage organic RWA within this business and within the bank as a whole. We are committed and we remain committed to being very disciplined in terms of the capital consumption there.
And we are working on increasing the return in terms of NBI on RWA in this division, and we will continue to do so with all the tools that are available for us in this space. In terms of Ayvens, I mean, let's keep it simple. No such thing as the one you described is on the table right now. We are committed to finishing the restructuring of this business, the combination of these two assets, and to making sure that the full potential from both growth and profitability, and look at the improving profitability, look at the targets from both cost to income perspective and ROE perspective at this business. These are compelling targets for a business which has different dynamics in terms of correlation and overall a fairly stable profile when you're not in a post-COVID era.
So strategically, we think it makes sense to continue to operate this business, and we are very committed to getting things completely deeply in order as we're doing it right now. So no deconsolidation whatsoever there.
Okay, thank you. If I may just follow up on your first part on the you highlighted the executive.
It sounds like a small question, but okay.
Okay, then I'll pass on then to my next colleague. Sorry. Thank you.
Come back when we're done with everybody.
Okay, thank you. Thank you.
The next question is from Flora Bocahut of Barclays.
Yes, good morning. Thank you for taking my questions. I actually would like to discuss French retail banking, both on the revenues and then on the cost side as well. On revenues, I mean, thank you for all the guidance you gave us for 2025.
There is obviously a lot of focus still on French retail specifically. So I was wondering if you could help us maybe better navigate what your expectations are there in terms of revenues specifically in 2025. What are the assumptions you would make? What are the main moving parts? What can we expect in terms of revenues basically there? And then on the cost side, I mean, despite the improvement, we're still looking at a business that is single-digit ROTE, a cost-to-income target for 2026 that looks difficult to achieve below 60%. So there is still the possibility maybe that you may consider additional cost cutting in that business. One of your peers actually announced that earlier this week. So how should we think about the risk of restructuring charges there?
Is there a way for you to cut costs in kind of a soft way without incurring significant charges via, for example, the natural attrition and without impairing the revenue generation capability? Thank you.
Thank you. Thank you very much. Listen, let me give you some color. On the NII, we're not going to give a guidance per se, but I'm going to give you a few of the moving parts and the way we're thinking about it. So one, you will have one technical impact, which is the change in perimeter linked to the sale of Private Banking Switzerland and in the U.K. And this is something you should think about as, from an NII perspective, a drag, I mean, not a drag, but a subtraction from the current NII base of EUR 35 million per quarter. So that's one element.
You see the performance of this quarter, which is slightly, I mean, significantly up for obvious reasons versus last year and slightly up sequentially from last quarter. Next element, you have an easing monetary policy, which most likely has impact, difficult to quantify, but has impact on behaviors. And this famous both deposit beta, but also more fundamentally, our ability to keep our balances in terms of sight deposits or to moderate their decrease will be better. So these are all kind of supporting factors to some extent. From a macro standpoint, in terms of both lending and deposit growth, we expect something mild, a very mild growth in the context of a subdued macro environment. And while things politically improved this week, a certain level of uncertainty, which obviously does not have the economic actors be extraordinarily active in terms of investments or otherwise.
So from this perspective, you should expect moderate growth in terms of the outstandings. And from a margin perspective, something we expect in the rate context to remain fairly stable. I hope that gives you quite a few inputs into the way you should think about it. In terms of the fees, because of us having put behind the merger and with the commercial momentum that we're sustaining, which is growing, and also the very strong performance last year, as you've seen in terms of fundraising and inflows, both at the private bank and at the retail bank and in terms of the life insurance business, you have something which is also supported from this perspective. And lastly, we are committed to maintaining BoursoBank profitable next year.
If you think about 26, because your question was somewhat also linked to the 26 target, remember, BoursoBank is going to be a significant contributor to both the revenue base and to the bottom line as committed by us at the CMD with a bottom line of roughly EUR 300 million. So with all that, you get a sense of how we're thinking about the revenue perspective here. In terms of the costs, listen, there is the benefit of the merger, which is substantial on a growth basis, which, as you know, was significantly impaired, the benefit, by inflation, the very significant inflation sequence that we had. But we are, as we said, committed as ever, both at the group level, but obviously at the French retail level, to increasing efficiency, lowering the cost further.
And here, you should think about this as, first of all, there is still some benefit to go naturally from the merger work and our overall focus on cost control. But you should also think about us as committed to continue to come up with new initiatives to make sure that we improve further. And to your point, single-digit ROE for this division, which will be lifted by everything I said on the revenue side, but it will also be lifted in terms of ROE by further work on the cost base. In terms of CTA, because you brought that up as well, let me keep it simple so that we can take more questions. We agree with you. We agree with you. We think that the big CTA event was the merger. And from now on, we want to focus on efficiency, simplification, and less CTA- intensive cost reduction.
We do believe that we have further opportunities to achieve further savings with much lower CTA intensity.
Very clear. Thank you.
The next question is from Giulia Aurora Miotto, Morgan Stanley. Yes, hi. Good morning, Slawomir, and good morning, welcome, Leopoldo. My first question will be a clarification on slide 6. It's great to see a clear strategy on excess capital distribution. Can I just check, though? When you say 13% pro forma post Basel IV, what do you mean exactly by Basel IV? Do you also include the output floors, or those are not included? Because we always talk about the day-one impact, but at some point, we also have got to think about the later days' impact.
Then secondly, perhaps to stick to capital, towards the second half of last year, there was a very nice pace of disposals announced, and headlines have gone quiet, and we haven't heard much since. What is next on your schedule? Do you still expect more disposals to come throughout this year as you continue to optimize your footprint? Thank you.
Thank you very much. Very simply, on Basel IV, we're on a phasing basis, if you will. We're thinking about this as being there in any circumstance. Addressing specifically the output floor, as far as we're concerned, we do not believe that there is any impact from the output floor for Société Générale. As simple as that.
Of course, and I hinted at that earlier, we do take into account the FRTB, which, again, right now is supposed to happen in January 2026, and we will follow that very carefully, both the postponement, but as you know, it can only be postponed by one more year. And then, let's say the conversation is going to get deeper. Is there a legislative route to scrap that altogether? Unclear at this point in time. And then, is there a supervisory way of scrapping that? Certainly. But at this point in time, I don't think that anyone has a clear view. So we do take this into account, and clearly, it's a material element in terms of how we will think about excess capital. But again, no other significant impact than this one, indeed, on what happens this quarter and the FRTB.
In terms of disposals, let me put it this way. One, if you think about it as, well, there was a bulk of work that we had to do, and it was obvious. It was obvious in what we said at the CMD. It's obvious in what we've actually executed. So the bulk of that, I think you should think about this as being behind us. Now, what we said consistently, and what I repeated very often, our commitment to constantly run an optimized business portfolio remains completely, totally unchanged. So with the criteria, which you know also, I'm not going to bother you with listing all of them, but headline ROE, cost of equity, ROE versus cost of equity, and so on and so forth, competitive advantage, tail risk, blah, blah, blah, everything we set out in our analytical grid remains in force.
And so we will continue to constantly look at whether we are the best-positioned owner for a particular asset. And so you should expect us to always, always comply with that strategic statement. Now, again, in terms of the recent flow and the next few months, you should think about this as a lot was done and more than half of the current phase. Let me put it this way.
Thank you.
Thank you.
The next question is from Delphine Lee of JP Morgan.
Hi. Good morning. Thanks for taking my questions. I just wanted to go back on the distribution, sorry, on the additional share buyback. So is the decision just dependent on FRTB?
So say you get more clarity by mid-year or at the end of the year, and this is the trigger because, I mean, the intention is to be above 13%, I think, for the whole year anyways, right, in 25 in terms of CET1. So is it a fair assumption to assume we are going to get exceptional buybacks in 25? And my second question is just on growth, organic growth. Now that you're at your target in terms of capital, is other rate growth going to pick up a little bit more, or is the intention to still keep it below 1% as per the business plan? Thank you.
Thank you. Thank you, Delphine. Listen, FRTB only as the main trigger for the potential exceptional share buyback? Well, yes and no. Yes, in terms of this is an important piece, right? 35 basis points is a lot of money.
No, because let me put it this way. It's not also about distributing, obviously, the first basis point above 13%, right? So it's a number of things. It's macro considerations. It's FRTB postponed by one year. Okay, but is this accompanied, for instance, by a strong statement from the supervisor saying, "Well, you know what? We're going to kind of upfront this in some other ways," how creative some of our stakeholders can be? So it's the overall picture and our deep understanding, conservative understanding of what the trajectory might be. Now, clearly, being well ahead of the plan, we want to make sure that people understand what our target is and what we would do with the excess capital. So yes, FRTB is a big piece. It's not the only one. And think of us as being committed to stable outcomes of our management actions, right?
And so we will seek to have enough clarity before we do anything, right? Hopefully, that helps. I know it doesn't give you a perfect date for the exceptional buyback, should it ever come, but it gives you some color at least. In terms of growth, let me put it very clearly, organic growth, two things. One, we will be within the guidance of the CMD, which was up to 1% growth over the periods. Now, you understand that once I say this, given the fact that we've been well under that in the last two years, this leaves actually pretty significant room. And here, we are committed to give you additional color versus the business plan commitment. We are committed to be very, very disciplined in terms of allocation, which leads me to my second point, be it now or in terms of allocating excess capital to organic growth.
We are committed to two things. One, profitable growth means substantially above in terms of marginal profitability, substantially above our group targets, and obviously, our business targets, right? So substantial uplift to average profitability. That's how I define profitable growth. And second thing, you should think about this as us talking to you about this in the future with a commitment to transparency. So you're not going to wake up one day with the question of, "What happened to that money? And why did you use everything in organic growth?" We will be very clear about the quantum and about the conditions, but I already gave you the conditions, the expectations for this profitability, providing a substantial lift to average group profitability, and transparently discussed with you.
Great. Thank you very much.
The next question is from Alberto Artoni of Intesa Sanpaolo.
Good morning. Thank you for taking the question.
Just two of them. One on BoursoBank. And could you please give us a little bit more color on what are the levers that you can pull? I guess it's just reducing the number of new customers that you want to acquire once you reach the eight million threshold. But if you can just give a little bit more color in terms of for letting us understand what is the earning power of BoursoBank. I know there is a guidance for EUR 300 million in 2026, but perhaps it can be a little bit more given the strong performance that the business is demonstrating in the last quarters. And the second one is on transformation cost. Just a clarification. I think there was, and correct me if I'm wrong, an indication about EUR 1 billion between 2024 and 2025. Is this guidance still valid?
Should we consider that just 2025 is way below 2026? What should we think in terms of transformation cost for 2025? Thank you.
Thank you. Thank you very much. I'll leave the second one to Leo. I'll take the first one on BoursoBank. The levers, I mean, in the end, you know the business model. The business model is simple, unique selling point, value proposition for the clients, extremely high level of delivery in terms of client satisfaction and the quality of the experience for the clients while offering the entire suite of investment products. Remember, it's originally a leading online broker, etc., etc. So you see, from a revenue perspective, where the levers are, they're on the NII, obviously, right? Because this is a deposit collection powerhouse as it acquires all these clients.
And remember, we talked about this in the past, high-quality clients from a wealth perspective and from a behavioral perspective and from a risk perspective. And so these are the moving pieces, right? So in the end, the first, obviously, mega, if I may use this word, impact is slowing down, reducing the acquisition costs very substantially, and that's what's in the plan for 2026. This will provide a revolutionary lift to the performance and will help deliver the 300 million EUR we have as a target. Remember, despite the easing monetary policy, which obviously is a negative, right, from a planning perspective. But despite that, we will deliver this kind of performance because of the very quality of the assets.
So levers are first acquisition costs and then continuing to be able to be a very low-cost provider of basic services while at the same time being a high-quality provider of high-added value products and with some further investments in terms of the loan outstanding as well. Just to give you a sense, in 2023, over the first two quarters, the range of the profitability was already close to EUR 200 million on a yearly basis with an ROE, which was extremely high. Let me put it this way. So that's how you should think about this business. Transformation costs, Leo?
Sure. Good morning, Alberto. Yes, you're spot on. So basically, we guided for a total amount of EUR 1 billion of CTAs for the period 2024 to 2026. Of these, we have used EUR 650 million this year.
So basically, the bulk of the rest, around EUR 300 million or so, should be used during the course of 2025. So basically, half the impact of 2024.
Thank you very much.
The next question is from Matthew Clark of Mediobanca.
Good morning. Two questions, please. Firstly, on the capital trajectory, could you just confirm whether there are any kind of model updates? I think last year there was some talk of on-site inspections or EBA guideline kind of headwinds to think about in the coming years. And then an early question on the GBIS division. On slide 61, you show the currency and scope-adjusted growth year on year, but I'm guessing that doesn't adjust for the Bernstein acquisition.
So could you give us what the impact of the Bernstein acquisition was on those key growth lines for revenues and costs or quantify the contribution from Bernstein in 2024 in EUR billion terms, please? Thank you.
Okay. Thank you. I'll leave the second question for Leo, and I'll start with the model updates. So very simple. We have recorded, as you've seen, an extra 50 basis points, which were expected in terms of impact this quarter and filling the 35 basis point guidance that we had out there. At this point in time, we have no major material impact on the radar, how this works, but we believe that we have, again, from a capital management tool kit perspective, everything to allow us to weather any type of headwind and deliver on our commitment to be above 13 throughout the entire 2025 year. Thank you.
Yeah.
As per the second question, I think we have never given any quantitative disclosure specifically with regards to Bernstein. I think this is Ayvens, which started to operate not so long ago. And the only thing we've indicated is that we are expecting EUR 200 million of annual contribution at target with the new structure. And we believe that 2025 should certainly take us closer to this ta rget.
Okay. Thank you.
The next question is from Chris Hallam of Goldman Sachs.
Yeah. Good morning, everybody. I just have two broader questions left. First of all, taking a step back, if you compare to the summer last year, your share price is up around 65%. CDS has tightened quite meaningfully. Those moves obviously reflect improved performance in the business. How has that changed the tone of conversations with corporate clients, with supervisors, with counterparties?
Are there parts of the group where it's almost easier to go out and do business now that those external reference points are on a much, much firmer footing? And then secondly, Slawomir, congratulations on your recent election as the new EBF president. I'd be interested to hear what you see at the top of the agenda for the industry more broadly as you kind of kick off that two-year term, particularly around regulation and competitiveness. I know we've talked about FRTB a lot on this call already, and whether you think there's political will and appetite to actually make tangible progress on these points. Thank you.
Thank you, Chris, and thank you for the kind words. Listen, how are the last six months of, let's say, share performance and momentum changed the tone of conversations?
Think about it this way, right? As far as clients are concerned, for 160 years, this is the number one supporter of SocGen and the number one constituency that has always placed their trust in us and that we always met with our commitment, our expertise, and all our energy to support their needs. Frankly, if you think about the last, whatever, 15 or 20 years, which, as you know, were not a walk in the park for the industry and for us, the one constituency which was consistently there were the clients. It says a lot about the company.
You remember, it's not just a broad marketing statement I'm making. It's that we've been over all these years consistently one of the top performers in terms of NBI on RWA, which I find one of the best metrics to show that our ability to generate gross margin effectively, right, with the usage of our core capital resource, our core raw material shows how competitive we are, and there's no competitiveness without the vote of confidence from the client. So that's one. Second constituency, you mentioned regulators. I mean, regulators have, as you know, an extremely deep understanding of what's going on.
And I think while I'm sure they follow a share price to some extent, I'm sure that it's the quality of the conversation, our commitment to remediate issues, and our commitment to be very transparent and have the best possible relationship in terms of dialogue, I think, is what matters most to them. And this is something we have, and I have personally been always committed to. And I think it's not a big change because I think we were in a decent place already with a lot of work, like everybody else, but in a very decent place already in terms of the discussion. And then there's us, the team, the broader team, the leadership team. And I think in the end, of course, it's a positive, right? Feeling that we have some positive momentum and some positive recognition is obviously something positive for everybody.
But in the end, I think it only increases our sense of accountability because each time the share price goes up, somebody extra, somebody new, or somebody more than he or she used to is trusting us, right? And this only increases the sense of accountability that is very deeply held in this company and in the leadership team. And so we're just trying to think about new ways to do even better and to basically meet that trust with our commitment to do better. In terms of the EBF presidency, listen, I'm a European citizen. I'm also an American citizen, but I grew up in Eastern Europe. I essentially spent most of my life in France. I feel extremely committed and concerned, committed to Europe and concerned with the current state of affairs.
And I felt that no matter how modest my contribution to the competitiveness agenda, to the strategic autonomy of Europe and strategic future of Europe, no matter how modest my contribution could be, I wanted to make it, right? And I think it's simple, right? You said it. There's a lot of talk about increased competitiveness. There's a lot of apparently political will committed to this. I fancy myself a doer. And so I'm really concerned about how do we move from political statements and political will to actual outcomes. And this is how I want to help with the EBF team and with all the members of the EBF advance the agenda for the banking industry. But remember, we're a cog of the entire economy, an essential piece of the overall competitiveness, and whatever we can do for this is going to benefit the entire economy of Europe.
So that's, in broad terms, my agenda. Thank you.
Okay. Thank you. Very interesting.
The next question comes from Jason Napier of UBS.
Good morning. Thank you for taking my questions. Two quick ones. First of all, just as a point of fact, Slawomir, can I just check that you still have the guidance of the CMD of RWA growth below 1%? The earlier question around investing at marginal ROTEs that are attractive, I wonder whether you were just talking about inorganic potential opportunities or whether you have actually dropped the RWA guidance from the earlier event. And then secondly, I think the emphasis that you bring to granular execution and long-run improvement in the firm is, I think, what investors really want to hear. I just wondered whether you might talk about where you think the resting ROTE is for the group on a fully restructured and recovered base.
One of your peers clearly this week directing attention to further out in the next few years, potential couple of hundred basis points in ROTE performance. Where do you think the right destination is for SocGen on its current perimeter? Thank you.
Thank you. Very clearly, I'm going to say it very clearly, very simply. We are maintaining our guidance of 1% growth, maximum growth of organic RWA over the plan, which was from end 2022 to end 2026, which once again leaves us ample room for growth in the next two years because we have underused, right, this availability, if you will, strategic availability. But again, we are maintaining this guidance. The RWA organic growth will be limited to 1% over the course of the plan.
In terms of the granular execution and the long-term ROTE, let me give you first a strategic answer, which is, as someone who knows this firm inside out and across having spent my entire career mostly working in many areas, in many geographies, etc., I think that there is no reason, there is no reason for us not to be within the leading pack long-term of the industry in Europe. I just simply see no reason unless lack of will or lack of imagination would be the reasons. And we do not lack will, and we do not lack imagination, right? So that's my more longer-term aspirational guidance. More concretely, we do have first the improvements that we already committed to, right, and the guidance that we already gave within the CMD, and we will be there. We will deliver this. And we are working constantly.
We are obviously already working constantly on figuring out how we can do better, much better across all our businesses as soon as possible. Right now, we're remaining in the frame of the CMD and the targets of the CMD in terms of reported ROE between 9%-10% and cost to income below 60%, which, as you know, will be already very substantial, very substantial improvements, not only versus the starting point, but versus the history of Société Générale in the number of the past years. I hope that helps.
Thanks very much. That's great.
The next question comes from Pierre Chedeville of CIC.
Yes. Good morning. Two questions on my side. First, a follow-up question regarding distribution and what you said about Brookfield, etc. I was just wondering if you could tell me if you have any target regarding your outstanding in the CIB.
I see that you have close to EUR 180 billion there. What is your view on that? Is it an amount that you think is satisfying, or do you think that you could lower this big amount to improve your profitability maybe? And regarding the distribution, I remember that when we met in London for a nice dinner, you began the conversation with the interim dividend. You had a lot of questions there, it seemed, and you asked why? And it seems to me, if I remember well, that you said that you were not theoretically opposed for an interim dividend, and we have seen one of your main competitors in France opt for that. I would like to know what is the state of your mind regarding this point. Thank you very much.
Thank you. Thank you. Listen, I'll start with the Financing and Advisory question.
Just a quick one on interim dividend. I haven't changed my mind. I'm not theoretically opposed. I like that line. But you know what? Leo is going to answer this in a second. He's an expert at this, as you know, where he comes from. So he's going to give you our latest thinking on the topic. But very important question on the outstanding. The way you should think about this in the sense that this is the way we think about this, it's in relation to the RWA and to the capital usage of the group, right? Today, the incremental profitability of an incremental unit of RWA consumed in this business is extremely high. Why?
Because in this business, you have the cost base, which is made of, in our case, of extremely experienced, talented, seasoned professionals, which are able, going back to my comment on NBI on RWA, specifically in this business, one of the best in the world in this particular business model, you have people able to generate a lot of value with one unit of capital. So at this point in time, it's not so much a question of NBI on RWA, meaning it's not a question of lowering the outstanding. It's a question of how, without committing too much extra organic capital and without, to be honest, increasing further the costs that much, how do we make more money? And this is where distribution and the asset light changes that we made, very deep ones, right?
This time around, this is not us saying, "We're moving to asset light like everybody did in the U.S. 20 years ago or 30 years ago," whatever. This is us making substantial change in how the teams are organized, how they work, etc., to really catalyze this effort of stable cost base, stable capital, more revenues, and more fees. And so this is what we're doing right now. So to answer even more directly your question, with the capital available, with the capital position of the bank, and with the guidance that we have, you should think about this as stable capital allocation to this business, but with a strong mandate and strong expectations that the ROE eventually, but also simply the returns across all metrics improve in this business, even if it's already a very successful business. Leo, on interim dividends?
Sure. Well, thank you for the question, Pierre.
As some of you may know, I come from the Spanish banking sector, and this is a well-seasoned sector on interim dividends, as many of you will know, because most of the banks do it. In my previous life, I thought this was very much related to the mix of the shareholder base because in Spain, there's quite a lot more of retail shareholders, which do appreciate very much this interim dividends because, as a matter of fact, this is kind of a cash flow. So it doesn't change the overall picture when you take into account the total dividends of the bank, but it's just a cash flow issue, so they get it before. I think it's something that certainly works. I did have some conversation with Slawomir before this came out, probably a couple of days ago, but we have not yet discussed it in the board.
Nevertheless, I think our distribution policy is intended for the long term. So if an interim dividend becomes something interesting from an investor's perspective, I think we can certainly consider it.
Okay. Thank you very much.
Thank you.
The next question comes from Kiri Vijayarajah of HSBC.
Yes. Good morning, everyone. A couple of questions from my side. So firstly, on the U.K. motor finance provision, if I look at the Ayvens slides, it looks like the majority of the exposure actually comes via LeasePlan. And I wonder, is there any recourse to the former private equity owners of LeasePlan to maybe claw some of that back? And obviously, most of that business, or all of that business, would have been written before LeasePlan was acquired by Société Générale and Ayvens.
I appreciate the provision itself isn't that large for now, but obviously, the range of possible outcomes people talk about is still pretty wide. So any kind of offset or clawback in the original acquisition terms. And then secondly, just very quick clarification. I think you mentioned EUR 35 million attrition from the sale of the private banking businesses. Was that total revenues or just on the NII line, that EUR 35 million per quarter? Thank you.
S o I'll start with the second question. No, the EUR 35 million was NII only.
Okay. Okay. Okay.
All right. And in terms of the Ayvens question, I'll leave the floor to Pierre.
I think for the moment, we cannot comment on this. We are still reviewing the legal terms, but there's no communication we can make at this point.
All right. All right. Okay.
The next question is from Anke Reingen of RBC. Sorry.
Thank you very much for taking my questions. I just follow up one follow-up question to Kiri's question. When you talk about the capital uncertainty in the course of 2025, is the motor finance part, is that one of the potential areas of uncertainty as well with respect to the capital, or you think it's just potentially even in a harsher case could be immaterial to matter? And then on slide, on the 2025 guidance, just to confirm, when you give the disposal impact, is that on a full-year basis, or is it basically depending on when you expect the deals to close? And one sneaky additional question on your tax rate guidance. What do you expect for 2025 depending on, and as a function of the French budget? Thank you very much.
All right. I'll leave the disposal impact on cost to Leo.
Can you just. I'm going to just check if I got you because we didn't hear you well here. You mentioned the motor finance impact on capital. I'm not sure I follow the.
Yeah. If the outcome on the motor finance, when you talked about switching from your above 13% to the 13% threshold on capital, you were saying that's a function of uncertainty being removed, and you pointed to FRTB. But would the motor finance element or discussions outcome be one of the uncertain? Is it material enough for you to be a factor to consider to the 13%?
So no, no, no. So very clearly, not at all. This is not a material impact at the group level.
And so when I was referring to, let's say, overall environment beyond FRTB, I wasn't referring to anything specific, but more the idea that it's not only about the postponement of FRTB going back to this example. It's what else is going to be there from a supervisory perspective, for instance, in terms of how the FRTB might be still implemented or anticipated if it's postponed per se. So no, there was no specific other uncertainty. It's just the overall idea of we're not going to distribute the first basis points, and therefore, it's going to take us a few more months to make sure that we have a clear picture in terms of what's ahead. But no, absolutely not material impact from the motor finance thing. In terms of the costs linked to disposals, Leo?
Sure. So good morning, Anke. Thank you for the question.
So the numbers that we're publishing in slide 9, which are basically a restatement of both the revenues and the costs that we had in 2024 and we're not going to have in 2025, taking into account all the disposals that we have announced and signed and are waiting to be closed. So it's taken into account both the total amount and the time at which we believe these disposals are going to take place. So it's impact, the lower impact that we're going to get in 2025 versus 2024. I hope that's clear.
Yeah. Thank you. And the tax rate, please. Thank you. Sorry.
So the tax rate, I mean, we do not expect any material change in our group tax rate.
As I said, I think in the past, from a fiscal perspective, what happens in France today in terms of the extra tax, etc., has a very limited impact on us. So no change to the tax rate of the group.
Thank you.
The next question is from Joe Dickerson of Jefferies.
Hi. It's Joe Dickerson here. Just a couple of questions for me. In terms of balance sheet growth, because that's been, I think, also one of the problems behind the revenue momentum. But if I look in the fourth quarter, you had about a EUR 13 billion quarter-on-quarter pickup in GBIS loans. I guess what drove that demand? Because it was also a healthy year-on-year. And then when we look at some of the higher-frequency data in France, it looks like mortgage production has picked up quite healthily in the first quarter.
I guess if you could discuss the demand dynamics in GBIS and then the start of the year in the French mortgage, if you're able. And then on BoursoBank, what's the impact, if any, in Q4 that you saw from the Bourso First launch? And do you expect that to be a meaningful contributor this year? Because it seems like you'll reach your eight million customer target at the half-year, and we can then start to see some, I guess, augmented profit growth from there in the second half of the year, hopefully. Thanks.
Thank you. Three questions. First, on the balance sheet in GBIS in particular. You need to think about the 15 basis points impact on the regulatory that we refer to as one, which is mostly within GBIS. The bulk of that is linked to the regulatory impact.
But from a business perspective, remember, it is a global division which has a fairly balanced business model across many sectors and is active all over the world. So believe me, if anything, we're turning down business when it's not good enough because the demand, global demand for investments in infrastructure, in energy, in power, and in some of the areas that we're very active in, is very strong, right? But specifically, and the size of the impact that you're referring to, this is linked to the regulatory impact in Q4. In terms of the mortgage production, I mean, listen, you know the French markets, and I'm not going to bore you with the Nth explanation of how it works.
We went through the industry, very adverse market conditions in which, because of the Livret A on the one hand and the limitation on the rates on the other hand, it was very unfavorable in terms of specifically mortgage origination. Effectively, if you're applying economic rationality to the pricing, and we do, it would have been deeply negative NII products. So we actually restricted origination very much up until very recently. Today, we came back to more standard conditions in the French market. And from this perspective, yes, indeed, the mortgage origination in the industry and at Société Générale increases materially. In terms of BoursoBank and the Bourso First product, I mean, this is just a good illustration of how we're thinking strategically about the business. We have this very, very valuable client base. Remember, churn around 3% and decreasing, right?
It's really about making sure that this high-quality client base, we provide it with the maximum opportunity to invest and to use the products they need. And if people have a higher level of needs and are willing to pay a little more for this, we're obviously going to provide them with this product. Is this going to be a game changer next year for the entire P&L structure of BoursoBank? No. But it illustrates how, at the very granular level, we're very focused on building up revenue generation capabilities in this business. In terms of the growth and how is that going to impact in 2025 the revenues, I mean, obviously, the earlier you reach a certain level of client base, you increase your outstanding and, in particular, deposits accordingly. And this is obviously driving revenue generation up.
Now, it's a balance between this and the acquisition cost. And for 2025, we remain committed to profitability, so to net income above zero, which, remember, from a CMD guidance perspective, is a significant improvement because we had said that we would spend, so to speak, in the development of BoursoBank, EUR 150 million in terms of negative GOI. And effectively, we will be above zero throughout this period. So this is, for 2025, the paradigm for BoursoBank.
Great. Thanks. Just to second the first part of my question, I was actually referring to the gross loans up EUR 13 billion quarter on quarter. But I think we got the answer in the end, which was, it sounds like the incremental demand is coming globally and across infrastructure, if I understood correctly. I wasn't really throwing to the—yeah. Okay.
I wasn't throwing so much to the capital consumption, more that it looks pretty well set up for revenue growth for 202 5.
Oh, definitely. Definitely.
Excellent. Thank you.
The next question is from Sharath Kumar of Deutsche Bank.
Thank you for taking my questions. I have two, mostly on global markets. I wanted to understand the reasons for the slightly lower growth than peers in both equities and fixed income. I would imagine capital being the main constraint, or is there more to it? In the same sense, I wanted to check your appetite to increase capital allocation to this division in the light of the criteria that you listed earlier. I would think that global markets fit that criteria. Again, I ask this in the context of their consensus expectations for 2025. Currently, it's well above your midpoint of your guidance. So on that, it will be useful.
A clarification again on slide 9 on the annual cost impact. Can you break it up by division? I think it will be useful for our modeling. I think there is enough clarity on revenues, such as EUR 270 million from private banking, EUR 400 million from equipment finance. But anything more, and also on costs, would be helpful to get a better handle on modeling. Thank you.
Thank you. I'll take the global market questions and leave the cost one to Leo. On the lower growth this quarter of the division, let me say a few things. One, to your point, we do operate, and for those who have had the patience of listening to me for the last few years, including in my previous position, have certainly heard me saying very often, "We have profoundly changed in the last now five years the way we do this business," right?
The best evidence of this is how regular and how stable, steady the quarterly performance is. It's a different take on volatility and a different take on what our appetite for volatility in this business is and a different take on the risk-reward there. If you look at least the European banks, I'm not going to compare ourselves to the American ones with their domestic market, but if you look at the European pool, what you would see is that at the year mark, so the entire full year of 2024 versus 2023, you will see that most of us are within one or two percentage points in terms of growth between, say, six and eight or nine.
And so it shows you that whatever happened this quarter to whomever was more a function of the volatility, the quarterly volatility, than of an overall performance for the year, right? And for the year, again, with a high level of stability quarter after quarter, we have delivered a substantially similar performance in terms of growth and actually, as you know, one of our best performance, certainly at constant business model ever. So now, why the discrepancy in the quarter? Mostly driven by some of the strategic features that I just described, but also mixed effect, pretty usual mixed effect for SG, which is, one, an exposure to the U.S. market, especially on the cash side, which is lower, both through cash equity and prime brokerage, lower than some of our peers. We don't have this kind of activity in terms of prime brokerage in the U.S.
We do have meaningful activities, but not this kind and this size, and in terms of the cash equity, our Bernstein JV in the U.S. is not consolidated, and so we don't see the revenues from that particular business in the top line, so that's one element. The second element is a product one, which is, especially from a fixed income perspective, we do not run the credit business the usual way. It's a much more focused business, much more specific business, and we do not carry significant credit inventories, and we don't do the business the same way others do it, and this is why, in the circumstances, market circumstances that you've been witnessing recently, we will, from a mixed perspective, have a different shape, if you will, in a particular quarter like that.
Lastly, the securitization and asset-backed products, which is part, obviously, of the credit in our CIB, it is located mostly in the global banking division. And this is what explains, partly, the very strong uptick in growth in Q4 that you see at that business, which is stemming from that part of the credit business, the securitization and asset-backed product business. Is increasing capital allocation to this division on the table? Listen, generally speaking, we're happy with the way this works. We're happy with the risk-reward. We're happy with the capital consumption, with the diversification at the group level. So significant incremental allocation to this business is not on the table today. Now, of course, here and there, at a very granular level, we may want to invest.
But overall, the idea is that from a general strategic balance of the group, we're happy with how much capital this division has. Cost impact, Leo?
Sure. So good morning, Sir. Thank you for the question. Basically, as I explained before, the full impact of EUR 800 million are related to transactions that have already been announced and signed, so basically the private banking transactions plus SGEF plus all the transactions in Africa. Roughly speaking, I would say that 35% of costs could be allocated to retail, basically retail in France and private banking, and 65% to GBIS.
Thank you. Next question.
The final question, sir, is from Jacques-Henri Gaulard of Kepler Cheuvreux.
Yes. Good morning, Leopoldo, and enhorabuena. Question on cost, really, and sorry to go on that. You're saying, Slawomir, that the cost-income ratio evolution is linear, but at the end of the day, not quite.
If the, I would say, cost-income ratio target is less than 66% and we need to go below 60%, it's quite a tough ask. I totally appreciate also in this context the -1% you have, 2025 versus 2024, but if I restate it from the EUR 300 million, I would say again, from the cost to achieve, the cost will be up by EUR 100 million, which is still quite a good performance. But are you nonetheless confident about the fact that it's not too much of a big mountain to climb? I appreciate the effort you're doing, but it's difficult to remove spots from the leopard. Thank you.
Thank you, Jacques-Henri. Listen, so I appreciate what you're saying, obviously.
The idea here, though, is the fact that in the current cost efficiency plan, the one from the CMD, you had indeed a lot of investments which were upfront, coming upfront, and were slowly reducing that to almost nothing in 2026, and as we are investing and implementing all these actions and working on the restructuring of Ayvens and working on the merger of French retail, we are gaining momentum in the cost outcomes, the positive cost outcomes that we were hoping for with the investment, right, so this is why, yes, I mean, there's a minor acceleration from a purely mathematical perspective that you can see there, and this is how you should think about it.
Now, confidence, more generally speaking, we went out with this extra guidance on the costs just to make sure that we were very clear about our commitment to this topic, about how serious we are and how deeply we understand that while preserving the top line, right, preserving the strength with clients that I referred to earlier is absolutely key. And I think our performance this year shows that we are committed, obviously, to this. This is the heart of our business. Without the clients, we would not be having this conversation today. But equally, we know that from a strategic standpoint, lowering the break-even point of this company, increasing its operating leverage, is a matter of strategy for the bank, right? It's a matter of being able to be even more resilient at times of downturns, but also, obviously, generating more returns in the future.
So we are committed, which means also to be very clear that it's not like we're looking at what we said 18 months ago and just following up on the initiatives that we had back then. We are constantly thinking about new ways of sustaining the momentum in terms of increased efficiency, lower cost base, and higher return.
Thank you very much.
Thank you.
Mr. Krupa, I'll hand it back to you, sir, if you'd like to make any closing remarks.
Thank you very much. Thank you very much for your time. I know you're all very busy, so it's a pleasure to have spent this hour and a half with you.
The only thing I want to tell you is what I hinted at during the conversation is we are all, the leadership team at the entire company, committed as ever to reward your trust with our performance and our hard work, and so thank you very much, and more to come during the next earnings call. Thank you very much. Have a good day. Take care.
Ladies and gentlemen, this concludes today's Société Générale conference call. Thank you for your participation. You may now disconnect.