French bank Societe Generale reported a sharp profit setback for the first quarter on Wednesday, blaming a big fall in the value of its assets in Russia, its second-biggest market for high-street banking.
The bank wrote down the value of assets acquired in Russia by 525 million euros ($731 million), saying it had taken account of the fall of the value of the ruble, slowing growth of the economy, and a rise in the cost of risk, reflecting the crisis in Ukraine.
These writedowns cut the group's quarterly net profit figure by 13.3 percent from the level at the same time last year to 315 million euros.
The impact of problems in Russia were evident in the results for the bank's Russian activities.
Excluding the effect of writedowns, net profit there fell by 79.5 percent to 7.0 million euros, owing to an almost doubling of provisions for doubtful loans.
Societe General increased its stake in its Russian subsidiary Rosbank in April and said on Wednesday that it considered the outlook for this business to be promising and that it was aiming for a return on shareholder funds of more than 10.0 percent in 2016.
Societe Generale said that activities in Russia represented only 3.0 percent of its worldwide activities.
Group net banking income, a key measure for banks of the difference between the cost of taking in deposits and making loans, rose by 14.0 percent to 5.68 billion euros.
Provisions for doubtful loans fell by 28.0 percent, with a particularly sharp fall for risks for loans to French businesses.
The bank, which marks its 150th anniversary this year, raised the ratio of core shareholder funds to loans made from 10.0 percent at the end of last year to 10.1 percent at the end of March.
This was well above the minimum level of 8.0 percent required by post-crisis regulations known as Basel III.
The price of shares in the bank was showing a fall of 1.71 percent to 43.13 euros in morning trading. The overall French CAC 40 index was down 0.20 percent.