Société Générale Ghana Records 45% Profit Surge in Q1 2025 on Higher Interest Income
- New Highs for Société Générale: Profits and Capital Both Climb Sharply in Q1
Société Générale Ghana PLC posted a strong financial performance for the first quarter ended March 31, 2025, buoyed by robust growth in net interest income, improving asset quality, and prudent cost management, according to its financial statements released to the Ghana Stock Exchange.
The French-owned Ghanaian lender reported a 45% year-on-year rise in profit after tax to GHS 136.6 million, compared to GHS 94.1 million recorded in the same period of 2024. The earnings surge was underpinned by a 13% increase in net interest income, which reached GHS 305.0 million for the quarter, up from GHS 269.8 million the previous year.
Operating income for the quarter rose modestly by 2.6% to GHS 347.5 million, reflecting the bank’s ability to maintain revenue growth amidst a challenging macroeconomic backdrop characterized by tight monetary conditions and moderated credit demand. Net fees and commission income expanded by a significant 34% year-on-year to GHS 23.4 million, highlighting Société Générale’s diversification of income streams beyond traditional lending.
At the same time, the bank’s asset quality metrics showed notable improvement. The non-performing loan (NPL) ratio declined to 17.49% from 22.58% a year earlier, driven largely by focused recovery efforts and portfolio restructuring. The bank reported a net impairment gain of GHS 28.9 million, reversing the GHS 36.4 million loss posted in the prior period, underscoring a healthier risk environment in its credit book.
Total operating expenses rose by 6% year-on-year to GHS 163.8 million, largely reflecting higher personnel costs and ongoing investments in digital infrastructure. However, Société Générale maintained tight expense discipline, with its cost-to-income ratio remaining broadly stable at approximately 47%, signaling operational efficiency improvements.
“These results reflect the underlying strength and resilience of our franchise, as well as our disciplined approach to risk and cost management,” said Hakim Ouzzani, Managing Director of Société Générale Ghana PLC, in remarks accompanying the financial disclosures.
Stronger Balance Sheet and Capital Position
The bank’s balance sheet expanded by 19% year-on-year to GHS 10.74 billion as of March 31, 2025, compared to GHS 9.03 billion a year earlier. Loans and advances to customers grew by 24% to GHS 4.82 billion, suggesting cautious optimism in credit origination despite macroeconomic headwinds. Customer deposits also recorded a robust 15% rise to GHS 6.44 billion, reaffirming customer confidence in the bank’s deposit franchise.
On the capital side, Société Générale Ghana’s shareholders’ equity rose sharply by 61% year-on-year to GHS 2.58 billion, supported by strong retained earnings and a sizeable revaluation surplus. The bank’s capital adequacy ratio (CAR) stood at 20.43% at the end of March 2025, well above the regulatory minimum of 13%, offering ample buffers for future growth and risk absorption.
Liquidity remained solid, albeit slightly moderated, with the liquidity ratio at 98.71% versus 106.72% a year earlier. Management attributed the decline largely to active investment activity and increased lending during the period.
Cash Flows Reflect Investment-Led Liquidity Outflow
While operationally strong, Société Générale Ghana reported a net cash outflow from operating activities of GHS 210.9 million for the quarter, primarily due to significant purchases of investment securities amounting to GHS 1.01 billion. Cash used in investing activities totalled GHS 26.3 million, while funds used in financing activities stood at GHS 126.7 million, driven by net debt repayments.
Nonetheless, the bank’s absolute cash and cash equivalents position remained healthy at GHS 3.29 billion as of end-March 2025, providing sufficient liquidity coverage even as cash balances contracted quarter-on-quarter.
Outlook: Building on a Resilient Foundation
Looking ahead, the management of Société Générale Ghana has expressed cautious optimism, emphasising continued focus on disciplined balance sheet growth, cost containment, and proactive risk management. The improving asset quality profile and strengthened capital buffers position the bank to weather potential macroeconomic volatility in the months ahead.
The banking sector in Ghana remains exposed to broader risks, including high inflationary pressures, elevated policy interest rates, and fragile private sector recovery. Nonetheless, Société Générale’s strong Q1 performance suggests resilience and strategic positioning to sustain growth through 2025.
Earnings per share (EPS) for the quarter rose to GHS 0.77, compared to GHS 0.53 in Q1 2024, reflecting the bank’s enhanced profitability and delivering strong value to shareholders.
With a well-capitalized balance sheet, stable liquidity buffers, and a diversified income profile, Société Générale Ghana appears poised to further consolidate its market position, balancing growth ambitions with prudent risk-taking.
