SocGen Q3 profit trails forecast, hikes provision

By Sudip Kar-Gupta

PARIS (Reuters) - Societe Generale missed forecasts despite doubling its third-quarter net profit from a year ago, and the French bank said the economic environment remained uncertain.

Like other banks that have reported earnings in the past few weeks, such as Credit Suisse and Deutsche Bank, investment banking results powered the profit line while SocGen added to debt provisions as many financial institutions expect bad loans to rise further in 2010.

Net profit rose to 426 million euros ($623 million) euros from 183 million a year earlier, mainly due to the fact that SocGen's investment banking arm swung to a profit from a year-earlier loss.

A Reuters poll of 10 analysts had produced an average net profit forecast of 481 million euros.

LINGERING BID SPECULATION

SocGen's results kicked off the third-quarter earnings season for France's banks, with larger rival BNP Paribas also expected to post higher earnings on Thursday.

Though many of the world's top banks have posted higher profits over the last month, doubts remain over provisions in the sector and the lingering effects of the financial crisis.

On Tuesday, UBS reported a third-quarter loss and the British government injected yet more taxpayers' money to help part-nationalised banks Royal Bank of Scotland and Lloyds Banking Group.