Société Générale posted record second-quarter profits on a booming French banking business, although the lender missed out on the trading bonanza that has boosted many rivals. The French bank, which also announced a €1.5bn share buyback on Thursday, has undergone a turnaround under chief executive Slawomir Krupa in the past three years, winning over investors after years of bumpy restructurings and setbacks.

It has overtaken rival Crédit Agricole to become France's second-biggest lender by market value once again, although it is worth only half as much as BNP Paribas. On Thursday Soc Gen posted a better than expected 23 per cent jump in net profit from a year ago to a record €1.79bn and raised its return on equity target for 2026 — a key measure of profitability — from more than 10 per cent to about 11 per cent.

Krupa's cost-cutting drive has also helped earnings along with vast improvements in its French retail bank. Attention may now turn to the investment bank, which has underperformed other parts of the lender for several quarters. Soc Gen missed out on a widespread trading boom in the April to June period that sent earnings across Wall Street soaring. Soc Gen's markets revenues fell 1 per cent from a year ago to €1.6bn, with fixed income and currencies trading down 11.3 per cent.

Equities trading performed better, with revenues up 5.5 per cent, but still less ebullient than peers. Krupa is set to outline his latest strategy plans in September, after a big focus on boosting capital and cutting costs until now.