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Société Générale — Earnings Release 2009
Aug 5, 2010
1671_iss_2010-08-05_f88a442b-af31-4098-8a1f-68a4b2f07573.pdf
Earnings Release
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Press Release
Paris, 5 August 2010
Sogecap : 2009 Embedded Value
In 2009, the Embedded Value of Sogecap is €3,200 million, an increase of 24% over 2008. The ratio of New Business Value on the present value of premiums is 1.7%, a very satisfactory level.
B&W Deloitte has certified, as usual since 2007, the Sogecap's Embedded Value calculations for December 31, 2009. In doing so, the firm reviewed exclusively the consistency of the applied methodology and assumptions and their compliance with the CFO Forum principles, the global reconciliation of the data with the accounts and the consistency of the results. The complete B&W Deloitte opinion is published in the detailed note entitled "Sogecap-2009 Embedded Value" and available on the site : www.sogecap.com.
Details of 2009 results
| In € millions | 2009 | 2008 | Variation |
|---|---|---|---|
| Adjusted Net Asset Value (ANAV) | 1,353 | 1,100 | 23% |
| Certainty equivalent portfolio value | 2,717 | 2,277 | 19.3% |
| Time value of financial options and guarantees | (561) | (555) | 1.1% |
| Cost of capital and non financial risks | (310) | (249) | 24.5% |
| Embedded Value (EV) | 3,200 | 2,573 | 24.4% |
| New Business Value (NBV) | 123 | 154 | -20.1% |
| NBV / present value of premiums (1) | 1.7% | 2.1% | -19% |
| NBV / APE (2) | 16.3% | 21.2% | -23.1% |
(1) Present value of premiums generated by activity in 2009 (including future scheduled premiums) is € 7,437m.
(2) APE : Annualized Premium Equivalent (10% of single premiums and flexible premiums, 100% of scheduled premiums) amounts to € 757m.
The results correspond to all Sogecap activities in France, including those of the Oradéa-Vie partnership. The valuation of foreign subsidiaries is only taken into account based on their book value.
The Embedded Value, representing the discounted value of in force business, was € 3,200m at end 2009, for an IFRS shareholders' Equity of € 1,598m. The surplus value is therefore around € 1.6bn.
PRESS RELATIONS SOCIETE GENERALE Hélène MAZIER +33 (0)1 58 98 72 74
Laura SCHALK
Laetitia MAUREL +33 (0)1 42 13 88 68
Astrid BRUNINI +33 (0)1 42 13 68 71 +33 (0)1 42 14 52 86 P.A +33(0)1 42 14 67 02 Fax +33(0)1 42 14 28 98 SOCIETE GENERALE COMM/PRS 75886 PARIS CEDEX 18 www.societegenerale.com
A French corporation with share capital of EUR 933,027,038 552 120 222 RCS PARIS
The new Business Value (NBV), the value of the activity generated in 2009, amounted to € 123m for French domestic business, i.e. 1.7% of the present value of premiums.
Breakdown of movements in Embedded Value between 2008 and 2009
| In € millions | Adjusted net asset value |
Portfolio value |
Total |
|---|---|---|---|
| Embedded Value published in 2008 | 1,100 | 1,473 | 2,573 |
| Adjusted value in 2008 | 1,100 | 1,440 | 2,540 |
| Operating result | 16 | 219 | 234 |
| Impact of the economic environment | 168 | 188 | 355 |
| Dividend paid in 2009 | - | ||
| Increase in capital | 70 | 70 | |
| Embedded Value 2009 | 1,353 | 1,847 | 3,200 |
The difference between the published 2008 value and the adjusted 2008 value is due to modelling changes and scoping.
The operating result corresponds mainly to the value of 2009 new business and the result expected to be generated by the portfolio of existing policies.
The economic environment had a positive impact on results (€ 355m) following the rise in equity markets and the fall in interest rates.
The operating return on Embedded Value was 9.2% (ratio between the operating margin and Embedded Value at end 2008) vs 8.5% in 2008.
Press contact - Sogecap: Jacky Gouvert, tel: +33 (0)1 46 93 54 87, email : [email protected]
Societe Generale
Societe Generale is one of the largest financial services groups in the euro-zone. The Group employs 157,000 people worldwide in three key businesses:
- Retail Banking, Specialised Financing & Insurance: Societe Generale serves 32 million individual customers worldwide.
- Private Banking, Global Investment Management & Services: Societe Generale is one of the largest banks in the euro-zone in terms of assets under custody (EUR 3,246 billion, March 2010) and under management (EUR 164 billion excluding Amundi, March 2010).
Corporate & Investment Banking: Societe Generale tailors solutions for its clients across sectors by capitalising on its worldwide expertise in investment banking, global finance, and global markets.
Societe Generale is included in the socially-responsible investment indexes: FTSE4Good and ASPI. In 2010, the title of SAM Sector Mover was awarded to Societe Generale. www.societegenerale.com
Sogecap
Sogecap is the life insurance and self-funded pensions company belonging to the Societe Generale group. It is the seventh largest Life company, and fourth largest bank insurance company in France in terms of turnover. Its 4 main activities are life insurance for borrowers, individual and group risk life insurance, savings and pensions. In 2009, the Sogecap Group generated a turnover of EUR 8,6 billion and managed more than EUR 70 billion of assets, representing 8,2 million of contracts.