Soc Gen: counting the cost of Egypt | beyondbrics – FT.com

It’s one thing to measure political risk in terms of swings in currencies, stock markets and CDS spreads. It’s another to count the costs in your P&L which is what Societe Generalehas had to for its operations in Egypt, Tunisia and the Ivory Coast.

The French bank on Wednesday disclosed, in its first quarter results, €50m provisions for the three countries “undergoing political transition”. With net income of €916m, the group can take the hit. But nobody wants to lose that much in what are still peripheral markets.

Investors, who had expected considerably higher net profits of €1.06bn, marked the shares down by over 3 per cent, reducing the gain for the past 12 months to 14.8 per cent.