Société Générale Bank & Trust

Société Générale Bank & Trust

11 avenue Emile ReuterL-2420 LuxembourgRCS Luxembourg B 6061Tel. +352 47 93 11-1Fax +352 22 88 59

sgbt.lu@socgen.comwww.sgbt.lu

annual Report

2005

on the back cover

Atlas marocain

November 2003

Caroline Dujardin

on the cover page

La mare aux fées (Detail)

January 2001

Caroline Dujardin

on the right page

Rivages (Detail)

March 2005

Caroline Dujardin

Sommaire

The Bank

4 Backedbyamajorbankinggroup8 SociétéGénéralegroup’sglobalinternationalnetwork10 SGBT,theadvantagesofabankwithmanylinesofbusiness14 SGBTBoardofDirectors,ManagementCommitteeandOperationalManagement

Management report

20 Businessreviewandoutlook22 ConsolidatednetincomeofSociétéGénéraleBank&Trust22 Consolidatedshareholders’equity

Market risks at December 31, 2005

26 Organizationofriskcontrol27 Methodsformeasuringmarketrisksandsettingexposurelimits29 Counterpartriskpolicy30 SociétéGénéraleBank&TrustLuxembourgMarkettransactionrisks

Consolidated financial statements

35 ReportoftheIndependentAuditor36 ConsolidatedbalancesheetatDecember31,200540 ConsolidatedincomestatementatDecember31,200542 NotestotheconsolidatedfinancialstatementsatDecember31,2005

Abridged version of the parent company financial statements

83 ReportoftheIndependentAuditor84 BalancesheetatDecember31,200587 IncomestatementatDecember31,2005

Summary

SOCIÉTÉ GÉNÉRALE BANK & TRUST

Nota bene: This english version is a translation of the french annual report. In the event of discrepan-cies between the english and french versions, the french text shall prevail. The french version is available upon request at the head-office of the company.

■ The Bank

Jardin

April1993

CarolineDujardin

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST�

Société Générale Bank & Trust (SGBT) is a wholly-

owned subsidiary of Société Générale, a leading Euro-

pean financial services group, operating in 76 countries

with more than 103,000 employees.

HISTory

A French banking group founded in 1864, now with

operations throughout the world

SociétéGénéralewasfoundedin1864bypublicsubscrip­

tion,withtheaimoffinancingindustrialinvestmentsandinfra­

structureprojects.

DuringthethirdRepublic,thecompanyprogressivelybuilt

upanationwidenetwork,andby1940hadopenedatotalof

1,500branchescomparedwithjust32in1870.

FollowingtheFranco­prussianWar,theAlsace­Mosellebran­

chesweretransferredtoaGermansubsidiary,SociétéGé­

néraleAlsaciennedeBanque(Sogénal).

AfteropeningaforeignofficeinLondonin1871,Société

Généralerapidlydevelopedan internationalnetworkby

extendingSogénal’sactivitiesintoCentraleurope(Ger­

many,Austria,Switzerland,Luxembourg),andbyestablishing

branchesinNorthAfricaintheperiodfrom1909to1911and

laterintheunitedStates(1940).

SociétéGénéralewasnationalizedin1945,andplayedanac­

tiveroleinfinancingpost­warconstruction.Ithelpedtospread

newfinancingtechniquessuchasmedium­termdiscountable

credit,off­balancesheettransactionsandleasefinance.

FollowingtheliberalizationoftheFrenchbankingsystemin

1966,SociétéGénéralediversifieditsactivitiesandexpanded

itsretailcustomerbase.

TheBankwasreturnedtotheprivatesectorinJuly1987.

Since1997,ithasexpandedconsiderablyviaacquisitionsin

itsdifferentbusinesses.

In1997,withthepurchaseofCréditduNord,SociétéGéné­

raleacquiredanetworkofregionalbanksenablingittostep

upitsretailbankingactivitiesinFrance.In2001,itabsorbed

Sogénal.

SociétéGénéralehasalsoextendeditsinternationalpres­

enceandnowhasoperationsin76countriesthroughoutthe

world.

ProFIlE

Société Générale is one of the leading financial ser-

vices groups in the euro zone and is structured into

three major business lines.

Retail Banking and Financial Services

The Retail Banking and Financial Services business line

includes French Networks (Société Générale and Crédit

du Nord), Retail Banking outside France and Financial

Services.

Leadingnon­mutualretailbankinFranceintermsof

netbankingincomeandnumberofbranches(source:

SociétéGénéraleandaffiliates)

Morethan19millionretailclientsworldwide

FrenchNetworks

TheSociétéGénéraleandCréditduNordnetworks(along

withsixregionalbanks)servetheneedsofsome9million

individualclientsandseveralhundredthousandbusinesses

andself­employedprofessionalswithafullrangeoffinancial

productsandservicesthroughmorethan2,800branches.

Backed by a major banking group

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST �

RetailBankingoutsideFrance

The universal banking business of the Retail Banking

NetworksoutsideFrancedivisionhasbeengrowingrapidly

since1998,especiallyinCentralandeasterneuropeandthe

MediterraneanBasin.Asaresultofthisexpansion,itnowhas

operationsin27countriesserving5.8millionretailcustomers

andnearly600,000corporateclients.

Financialservices

TheFinancialServicesdivisioncomprisescorporatefinancing

andservices,consumerlending,insuranceandmeansof

payment.

­Corporatefinancingandservices

No.1ineuropeinvendorandequipmentfinance(Société

GénéraleequipmentFinance)

No.1ineuropeinITassetleasingandmanagement(eCS)

No.2ineuropeinvehicleleasingandfleetmanagement

(ALDAutomotive)

­Individualcustomerfinance

expansionoftheconsumerlendingbusinessviaacquisitions

inGermany,Italy,poland,RussiaandHungary.SociétéGé­

néraleConsumerFinancenowhasoperationsin12coun­

trieswithleadingpositionsinFrance,ItalyandGermany.

Sogécapprovidesanextensiverangeoflifeinsurance

productstocustomersoftheretailnetworksbothinFrance

andabroad(Morocco,egyptandtheCzechRepublic).

Global Investment Management and Services

The Global Investment Management and Services division

includes the asset management business (Société Générale

Asset Management), private banking (SG Private Banking),

securities services (Société Générale Securities Services) and

online savings (Boursorama).

No.4assetmanagerintheeurozoneintermsofassets

undermanagement(source:SociétéGénéraleand

affiliates)

No.3forsecuritiescustodyineuropeandno.10inthe

world

AssetManagement

SociétéGénéraleAssetManagementisoneoftheleading

assetmanagersintheeurozonewithtotalclientassetsof

euR386billionatDecember31,2005.Thegroupoperates

viafourassetmanagementplatformsinFrance,theunited

kingdom,theunitedStatesandAsia.SociétéGénéraleAs­

setManagementoffersinstitutional,corporateandindividual

clientsprivilegedaccesstoafullrangeofassetsclassesin

allfinancialmarkets.

Since2000,SociétéGénéraleAssetManagementhas

beenratedAM2+byFitchRatings–thehighestrating

grantedtoanassetmanagerforitsglobalnetwork(ex­

cludingalternativeinvestments).

In2006,forthethirdconsecutiveyear,SociétéGénérale

AssetManagementwasnamedtheBestAssetMana­

gerbyFrenchinstitutionalinvestors(Amadeis,February

2006).

� ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST

privateBanking

Withoperationsin23countries,primarilyineuropeandAsia,

SGprivateBankingisoneoftheprivatebankingleadersin

mostoftheinternationalfinancialmarketswhereithasope­

rations.ItcaterstoaclientelewithatleasteuR1millionin

financialassetsthankstotheexpertiseofstaffspecializedin

assetengineeringandassetallocation.Inaddition,itoffers

acompleterangeofglobalfixedincome,equity,commodity

andinvestmentfundproducts.

privateBanker International2005namedSGprivate

BankingtheOutstandingprivateBankforAlternative

Investments.

euromoneynamedittheBestGlobalprivateBankforits

structuredproductoffering.

SecuritiesServices

SociétéGénéraleSecuritiesServices(SGSS)providesafull

arrayofservicesforlistedsecuritiesandderivativeproducts

inallfinancialmarkets.AtDecember31,2005,thelocaland

globalcustody,depositoryandvaluationbusinessestogether

hadeuR1,418billionofassetsundercustodyandnearly

3,800fundsunderadministration.Withitsambitious2006

acquisitionofunicrédit’ssecuritiesservicesbusiness,SGSS

becamethethird­rankedcustodianineurope.

ItsFimatsubsidiary,oneoftheleadinginternationalbrokers,

offerscompetitiveexecutionandclearingservicesforawide

rangeoffinancialproducts.

FitchRatingsraisedSociétéGénérale’sGlobalCustody

ratingtoCu2+,thesecond­highestratingonitsscaleand

uphelditsTR2+Trusteerating.

SGSSwasrankedtheleadingGlobalCustodianbyasset

managementcompaniesintheR&MConsultantssurvey.

Onlinesavings

Boursoramaisaleadingdistributorineuropeofonline

savingsproductswithmorethan460,000clientsandeuR

7.5billionindepositsatDecember31,2005.

BoursoramaisFrance’sleadingonlinebroker.

Corporate and Investment Banking

Société Générale Corporate & Investment Banking groups

together all capital market and financing activities for corpo-

rate clients, financial institutions and institutional investors in

Europe, the Americas and the Asia-Pacific region.

SociétéGénéraleCorporate&InvestmentBankingcombines

innovationandqualityofexecutiontodevelophighvalue­

addedfinancialsolutionsinitsthreekeyareasofexpertise:

derivatives,eurocapitalmarketsandstructuredfinance.

No.3incorporateandinvestmentbankingintheeuro

zoneintermsofnetbankingincome(source:Société

Généraleandaffiliates)

Astandard­setterineurocapitalmarkets,derivatives

andstructuredfinance

eurocapitalmarkets

­Debtmarkets

No.5foreuro­denominatedbondissues

No.4forcorporatebondissues

No.4forfinancialinstitutions

No.7bookrunnerforsyndicatedloansineurope

No.1forsecuritizationineurope

(sources:IFRandeuromoney)

�ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST

­equitiesmarkets

BestequityHouseinFrance(euromoney)

No.8inequitiessalesineurope

Derivatives

BestequityDerivativesHouseoftheYearaccordingto

RiskMagazine,IFRandTheBanker

Top5ininterestrateandcreditderivatives

Top5incommoditiesderivatives

No.14inforeignexchangemarketsandsecondinstruc­

turedforexproductsforinvestors

Structuredfinance

No.1globallyinexportandstructuredcommodityfinance

accordingtoTradeFinanceMagazine

GlobalprojectFinanceHouseoftheYearinprojectfinan­

cing(pFI)

Professionalism, team spirit and innovation

SociétéGénérale’sthreesharedvalues.

Commitment to sustainable development

Thegroupisincludedinthefourmaininternational

sustainabledevelopmentindexes.

Financial strength

Long­termfinancialratings:AA­withpositiveoutlookby

Standard&poor’s,Aa2byMoody’sandAA­byFitch

(atDecember31,2005).

Consolidated data 2005 2004

200�:inaccordancewithIFRS(excludingIAS32-39andIFRS�)andafterreclassificationoftheSogécapcapitalizationreserve.200�:inaccordancewithIFRS(includingIAS32-39andIFRS�).

results(inmillionsofeuros)Netbankingincome 19,1�0 1�,390Operatingincome �,��� �,��0Netincomebeforeminorityinterests �,92� 3,�23Netincome �,��� 3,281Activities(inbillionsofeuros)Totalassets 8�8.� �01.�Customerloans 22�.2 208.2Customerdeposits 222.� 213.�Groupshareholders’equity 23.� 18.�

2005 KEy FIGurES For THE GrouP

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST8

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Société Générale group’s global international network

French Networks, Retail Banking outside France and Specialized Financial Services

Algeria,Australia,Austria,Belgium,Benin,Brazil,Bulgaria,BurkinaFaso,Cameroon,Chad,China,Croatia,Cyprus,CzechRepublic,Denmark,egypt,equatorialGuinea,estonia,Finland,France,Frenchpolynesia,FrenchWestIndies,Germany,Ghana,Greece,Guinea,Hungary,India,Ireland,Italy,IvoryCoast,Japan,Jordan,kazakhstan,Latvia,Lebanon,Lithuania,Luxembourg,Madagascar,Malte,Montenegro,Morocco,Netherlands,NewCaledonia,Norway,poland,portugal,Reunion,Romania,Russia,Senegal,Serbia,Slovakia,Slovenia,Spain,Sweden,Switzerland,Tunisia,Turkey,ukraine,unitedkingdom.

Société Générale Asset Management (SGAM)

Australia,Barhain,China,CzechRepublic,France,Germany,Hongkong,India,Ireland,Italy,Japan,Luxembourg,Monaco,Romania,Singapore,Southkorea,Spain,Taiwan,unitedkingdom,unitedStates.

SG Private Banking

Bahamas,Belgium,Brunei,China,France,Gibraltar,Greece,Guernsey,Hongkong,India,Indonesia,Japan,Jersey,Luxembourg,Monaco,NetherlandsAntilles,Singapore,Switzerland,Thailand,unitedArabemirates,unitedkingdom,unitedStates,uruguay.

retail Banking and Financial Services Asset Management Private Banking

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ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST 9

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Société Générale Securities Services (SGSS)

Argentina,Australia,Brazil,Canada,China,France,Germany,Greece,Hongkong,India,Ireland,Italy,Japan,Luxembourg,Mexico,poland,Singapore,SouthAfrica,Southkorea,Spain,Switzerland,Taiwan,unitedkingdom,unitedStates.

Société Générale Corporate and Investment Banking (SGCIB)

Argentina,Australia,Austria,Azerbaijan,Belgium,Brazil, Canada, Chile, China, Cuba, France,Germany,India,Indonesia,Iran,Ireland,Italy,Japan,kazakhstan, Luxembourg, Malaysia, Mexico,Netherlands,Norway,panama,philippines,poland,portugal,Singapore,SouthAfrica,Southkorea,Spain,Sweden,Switzerland,Taiwan,Thailand,Turkey,ukraine,unitedArabemirates,unitedkingdom,unitedStates,uzbekistan,Venezuela,Vietnam.

Securities Services Corporate and Investment Banking

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ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST10

luxembourg-based Société Générale Bank & Trust

(SGBT) provides services to a diversified international

clientele.

HISTory

The road from a commercial bank to a bank with many

lines of business

Sogénal(SociétéGénéraleAlsaciennedeBanque)already

hadasolidbaseintheAlsaceandMoselleregionsasfar

backas1893.Atthattime,itwasthefirstforeignbanktoset

upbusinessintheGrandDuchyofLuxembourg.until1940,

itrana10­branchnetworkintheduchy.

ThesecondworldwarforcedSogénaltoshutdown,butit

resumedbusinessin1956.Asearlyas1964,italreadyhad

internationalorganizationsandmajorLuxembourg,French

andGermangroupsasclients.Itwasapioneerincorporate

financeandcashmanagement.

Sogénalalsodevelopedinotherareassuchasfinancialen­

gineeringandmutualfundmanagement.Overthe1970sand

1980s,itacquiredrealexpertiseinsecuritiesandmutual

funds,andwasoneofthefirstbankstocreateumbrellamu­

tualfundswithaeuropeanpassport.

In1981,SogénalacquiredLuxbanque,aprivatebanking

specialist.Sinceitreopened,ithasalsobeenveryactivein

capitalmarkettransactions.Itstradingroomisoneofthe

biggestinLuxembourgandenablesittoofferitshighnet

worthcustomersacomprehensiverangeofcustomizedand

personalizedproductsinadditiontoconventionalmoneymar­

ketproducts.

In1995,SogénalandLuxbanquemerged,givingrisetoSo­

ciétéGénéraleBank&Trust(SGBT),whichincludedSogé­

nal’sSwissbranches(Zurich,GenevaandLugano).SGBT

expandeditsactivitiesintoprivatebankingfirstbysettingup

aspecializedsubsidiaryinMonaco(SGBTMonaco).Then,in

1998,itacquiredaZurich­basedprivatebankcalledRüegg

Bank.In2003,itacquiredCompagnieBancaireGenève,enab­

lingittoconsolidateitsSwissoperationsbyforminganew

entitycalledSGprivateBanking(Switzerland).

In2003,SGBTalsospunoffitscentralizedinvestmentfund

administrationbusinessintoeuro­VLLuxembourgS.A..

Morerecently,in2005,SGBTincreasedthescopeofitsprivate

bankingbusinessbysettingupanewbranchinSingapore

bytakingoverSociétéGénérale’sprivatebankingactivities

there.

Today,asaresultofitshistoryandabilitytoinnovate,SGBTis

abankwithmanylinesofbusiness.Startingoutincorporate

banking,itgraduallyturnedtoinstitutionalclients(Securities

services)andhighnetworthclients(privateBanking)building

onitsbusyfrontoffice.

SGBT, the advantages of a bank with many lines of business

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST 11

ProFIlE

Four major business lines linked to those of Société

Générale

Private banking and capital markets

Recognized expertise and customized services for high net

worth individuals

SociétéGénéraleBank&TrustisamemberofSociétéGé­

nérale’sglobalSGprivateBankingnetworkandoperates

privatebankingbusinessesinLuxembourg,Switzerlandand

Monacoand,since2005,inSingapore.Itprovideshighnet

worthindividualswithacomprehensiveapproachtotheir

needsthroughadvisoryandassetengineeringservices.It

alsoprovidesawiderangeofopen­architectureproducts

thatareamongthebestavailableonthemarket.

Bankingservicesandinvestmentadvice

Assetengineeringandtaxplanning

Assetmanagement(discretionary,advice,trading)

Servicestoexpatriates

Lifeinsurance

A dynamic, innovative trading room

SGBT’sfrontofficeinLuxembourgactivelyservestheneeds

ofthecorporate,institutionalandprivateclientsoftheglobal

SGprivatebankingnetwork,offeringarangeofstructured

solutionswiththeappropriateexpertiseforeachtypeofun­

derlyingsecurity(equities,fixedincome,foreignexchange,

commodities,etc.).Onceagainthisyear,SGprivateBanking

wasnamedthebestglobalprivatebankforitsstructured

productofferingbyeuromoney.

Corporate services

A diversified, innovative offering for businesses

Becauseitstartedoutasacommercialbank,SGBT’sLuxem­

bourgoperationcanfundthegrowthofbothlocalbusinesses

aswellasmajormultinationalcorporationsthroughouttheir

entirelifecycle.Itspersonalizedofferingisdesignedforall

typesofcompaniesandfeaturesservicesrangingfromdaily

cashmanagementandadviceonincorporatingbusinesses

underLuxembourglaw,totheimplementationofstructured

financearrangements.Tocomplementitslocalcapabilities,

SGBTalsoregularlycallsonthesupportoftheinternational

networkofSociétéGénérale’sCorporateandInvestment

bankingdivision.

Corporatebanking

Financialengineering

Cashmanagement(domesticandinternational)

Securities services

A comprehensive line of services designed for institutional

clients, fully integrated into the Société Générale Securities

Services (SGSS) network

InLuxembourg,SGBTanditseuro­VLLuxembourgsubsidiary

provideinvestorswithabroadrangeofservicescoveringall

theirrequirementsforallassetclasses,onallmajorinterna­

tionalmarkets.

Depositoryandcustodianbank

Fundadministration(euro­VLLuxembourg)

Third­partyfundtrading

Issuerservices

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST12

Consolidated data 2005 2004

(inbillionsofeuros)

Totalassets 28.8 21.�

Shareholders’equity 1.� 1.�

Customerloans 10.9 �.1

Customerdeposits 12.� 8.2

(inmillionsofeuros)

Netbankingincome 388.0 3�1.1

Grossoperatingincome 202.0 180.�

Netincome 1��.� 1��.0

KEy FIGurES For SGBT IN 2005

WithSociétéGénérale’sacquisitionofunicrédit’ssecurities

servicesbusinessinearly2006,theLuxembourgoperation

willagainstrengthenitsdepositoryandcustodian,fundadmi­

nistrationandtransferagentbusinesses,becomingaleader

inthisareainLuxembourg.

SGBT has a solid financial base and is fully integrated

into Société Générale’s commercial structure. As a

result, Standard & Poor’s has assigned SGBT a long-

term rating equivalent to Société Générale’s AA- with

a positive outlook.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST 13

SGBT orGANIzATIoN CHArT

Société Générale Group

Société Générale Bank & Trust S.A. Group

100%

SociétéGénérale

Bank&TrustSingapore

succursale

SociétéGénérale

Bank&TrustMonacoS.A.M.

100%

SGPrivateBanking

S.A.(Suisse)

��.�2%

Euro-VLLuxembourg

S.A.

��%

Immobilièredel’Arsenal

S.à r.l.CoparerB.V.

100%

SogelifeS.A.

�9%

MontalisInvestment

B.V.

9�%

SGBTFinance

IrelandLimited

100%

SGBTEuropean

CitiusInvestmentS.A.

99.99%

SGPrivateBanking

(Curaçao)N.V.

100%

SGPrivateBanking

(Lugano–Svizzera)S.A.

100%

Thefollowingwereaddedtotheorganizationin2005:

Twonewsubsidiaries:SGBTFinanceIrelandLtd.and

SGBTeuropeanCitiusInvestmentS.A.arefinancialcom­

panieswhosemainbusinessistoprovidefinancingto

companies.

Anewbranch:SociétéGénéraleBank&TrustSingapore,

dedicatedtoprivatebanking.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST1�

BoArd oF dIrECTorS

CHAIRMAN

Pierre MATHÉ

GlobalHeadofprivateBanking,SociétéGénérale

CHIeFexeCuTIVeOFFICeR

Albert lE dIrAC’H

DIReCTORS

Alain CloSIEr

GlobalHeadofSecuritiesServicesforInvestors,

SociétéGénérale

Philippe CollAS

ChiefexecutiveOfficer,

GlobalInvestmentManagementandServices,

SociétéGénérale

Bernard dAvId

DeputyHeadofprivateBanking,SociétéGénérale

August GruBEr

ChiefFinancialOfficer,privateBanking,SociétéGénérale

MANAGEMENT CoMMITTEE

exeCuTIVeCOMMITTee

Albert lE dIrAC’H

Chairman

vincent dECAlF

Co­chairman

Jean-Charles FErrÉ

CorporateSecretary

Michel BECKEr

régis MEISTEr

Pierre SCHWENGlEr

STATuTory AudITorS

Ernst & young

6,rueJeanMonnet

L­2180Luxembourg

SGBT Board of Directors, Management Committee and Operational Management

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST 1�

oPErATIoNAl MANAGEMENT

(Luxembourg, Switzerland, Monaco, Singapore)

SoCIÉTÉ GÉNÉrAlE BANK & TruST

(luxEMBourG)

11,avenueemileReuter

B.p.1271

L­1012LuxeMBOuRG

Tel.:(352)479311­1

Fax:(352)228859

email:sgbt.lu@socgen.com

www.sgbt.lu

Albert lE dIrAC’H

ChiefexecutiveOfficer

HélèneCRINquANT,HumanResources

JeanCOIGNARD,AssetandLiabilitiesManagement

GillesMONTANGeRAND,InternalAudit

RenéDALVIT,Secretary,BoardofDirectors

vincent dECAlF

Manager,privateBankingandCapitalMarkets

Private Banking

AlainROBILLARD,MarketingandSalesManagerandMajor

privateInvestors

GhislaindeWASSeIGe,MarketingandSalesCoordination

DanielDIDIeR,Operations

philippekeNIS,Development

StéphaneWATHIeR,AssetManagement,productsand

Investment

ClaudioBACCeLI,Assetengineering

NicolepOLLeFORT,SeniorBanker

Capital Markets

StéphaneCHReTIeN,MarketOperations

NicolasCAGINICOLAu,Sales

BertrandkAuFFMANN,Treasury

RalfkRAY,Forex

Michel BECKEr

Manager,SecuritiesServices

philippeTOTAL,DeputyHead

RégisVeILLeT,Sales

régis MEISTEr

Manager,CorporateBanking

OlivierpeLSSeR,CorporateBanking

YvesCACCLIN,CorporateFinancialengineering

xavierBLOuIN,Development

Jean-Charles FErrÉ

CorporateSecretary

ericBeRLING,Finance

GuillaumedeSéVeRAC,Risk

RolandBeRSCHeID,Compliance

Pierre SCHWENGlEr

Manager,Administration

LucDOSqueT,ITResearchandOperations

emmanuelLADAIque,CapitalMarketsBackOffice

Jean­MariekROL,paymentSystemsBackOffice

HabibSAGHBINI,Organization

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST1�

SuBSIdIArIES

SG PrIvATE BANKING (SuISSE) S.A.

6,ruedelaCorraterie–Casepostale5022

CH­1211GeNeVe11

Tel.:(41)228190202

Fax:(41)228190403

www.sgprivatebanking.ch

Bernard SoNNTAG

ChiefexecutiveOfficer

Joseph ToSoN

SeniorexecutiveVicepresident

Alberto vAlENzuElA

SeniorexecutiveVicepresident

Jean-François PAQuErEAu

SeniorexecutiveVicepresident

zurICH BrANCH

Talstrasse66–postfach

CH­8021ZuRICH

Tel.:(41)442185611

Fax:(41)442116416

lAuSANNE BrANCH

AvenuedeRumine20–Casepostale220

CH­1001LAuSANNe

Tel.:(41)213431212

Fax:(41)213431213

SG PrIvATE BANKING (luGANo-SvIzzErA) S.A.

VialeStefanoFranscini22–Casellapostale5830

CH­6901LuGANO

Tel.:(41)919237642

Fax:(41)919220808

MIAMI rEPrESENTATIvE oFFICE

SGprivateBanking(Suisse)S.A.

701BrickellAvenue–Suite1740

uSA­MIAMIFL33131

Tel.:(1)3053793221

Fax:(1)3053793696

SG PrIvATE BANKING (CurAçAo) Nv

Gaitoweg35–p.O.Box4729

CuRAçAO–NeTHeRLANDSANTILLeS

Tel.:(599)97366760

Fax:(599)97366868

MoNTEvIdEo rEPrESENTATIvE oFFICE

SGPB (SuISSE) S.A

WorldTradeCenterMontevideo–Torre1

Avda.LuisAlbertodeHerreraN°1248

Oficinas1902–1903

uRuGuAY–11300MONTeVIDeO

Tel.:(598)26232840

Fax:(598)26232841

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST 1�

SoCIÉTÉ GÉNÉrAlE BANK & TruST (MoNACo)

13­15,BoulevarddesMoulins–B.p.250

MC98007MONACOCeDex

Tel.:(377)97975800

Fax:(377)97975876

email:sgbt_monaco@monaco377.com

www.sgprivatebanking.com/monaco

Christian zErry

GeneralManager

Jean-Claude GrACIA

CorporateSecretary

Gérard oHrESSEr

privateBankingManager

BrANCH

SoCIÉTÉ GÉNÉrAlE BANK & TruST (SINGAPorE)

28thFloor,80RobinsonRoad

Singapore068898–SINGApORe

Tel.:(65)63267333

Fax:(65)62250187

email:info@sgprivasia.com

www.sgprivasia.com

ManagementCommittee

daniel TruCHI

Patrick drEyFuSS

ChiefFinancialOfficer

Philippe GruMBErG

HeadofMarketingandSales

Pierre BAEr

lagune

January2003

CarolineDujardin

■ Management report

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST20

BuSINESS rEvIEW

SGBT’sfinancialresultsfor2005wereachievedinanenviron­

mentfeaturingaturnaroundineuropeanstockmarketsanda

businessclimatefavorabletofinancialactivities.Allbusiness

linesandalloftheentitiescontrolledbySGBTfullybenefited

fromthissituation.

privateBankingcustomerswereparticularlyactiveresultingin

asharpincreaseinthenumberofstockmarkettradesanda

cleargainforalternativeinvestments.Inaddition,theSociété

GénéraleGroup,andinparticularSGBT,wererecognizedby

euromoneyasthebestglobalandregionalprivateBanking

institutionsintermsofstructuredproducts.

Theassets frominstitutional investorsheld incustody

andadministeredbySGBTincreasedsharplythankstoa

combinationofsustainedfundsgatheringeffortsandthe

marketeffect.

Intheareaofcorporateservices,theLuxembourgunitshowed

itsvitalityinbothcorporatebanking,financialengineeringand

cashmanagement.

Asaresult,allgroupentitiesaddedbothsalesandsupport

servicestaff,astheworkforceincreasedtoanaverageof

1,272employeesin2005,upfrom1,028in2004.Thismade

itpossibletohandletheincreaseinbusinesswhileenhan­

cingthequalityofourserviceandriskcontrol.Wewerealso

abletocomplysatisfactorilywiththeeuropeandirectiveon

thetaxationofsavingsincomeandthetransitiontoIFRS,as

partofthereportingrequirementstoourparentcompanyand

heightenedcompliancerequirements.

In2005,wecontinuedtoapplyourcreditandmarketrisk

policy,whosepurposeistosupportsaleswhilebeingse­

lectiveinordertoavoidharmingtheintrinsicqualityofthe

portfolio.Allofthecomponentsofthecostofrisk(creditand

operational)remainedatalowlevel,givenbusinessvolumes,

whileoperatingexpensescontinuedtobeheldincheck.

Inall,profitabilitywassatisfactory,particularlysincethestrong

performanceofourbusinesslineswasoffsetbyvariousex­

ceptionalprudentialitemssuchastheincreaseingeneral

provisions.

SGBT’sconsolidationscopegrewwiththesettingupofa

branchinSingapore.ThebranchbeganoperationsonNo­

vember4,2005,furthertothetakeoveroftheprivateban­

kingbusinesspreviouslyrunbySociétéGénérale’sSingapore

branch.Withaworkforceof148atDecember31,2005,the

newSGBTSingaporebranchcontributedeuR2,454million,

or9%oftotalconsolidatedassets.

Standard&poor’sconfirmedSGBT’ssolidfinancialstruc­

turebyassigningitaratingequivalenttoSociétéGénérale’s

AA­withapositiveoutlook.

2005netbankingincomeroseby12%toeuR388million

comparedto2004.GrossoperatingincomereachedeuR

202million,upby9%from2004,and2005net income

amountedtoeuR145.7million.

SGBTdidnotbuybackanyofitsownsharesin2005.

Business review and outlook

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST 21

ouTlooK

Nosignificanteventlikelytomodifythefinancialstatements

at31December2005tookplaceateitherSGBToranyofits

subsidiariesandbranchessincetheendoftheyear.

Ateachentity,initiativesin2006havebeenacontinuationof

thoseembarkedonin2005inorderforourstafftobecome

moreproactiveintermsofsalesandtooffernewproducts

andservicestoourclientsaspartoftheSociétéGénérale

Group’sstrategy.

Inearly2006,SGBTtookovertheprivateBankingbranches

inGreece(nowknownasSGBTHellas)thatwerepreviously

runbySociétéGénérale.

SGBTSingaporeprojectsthatitsbusinesswillcontinueto

growasaresultofstrongeconomicgrowthinAsiaandan

increaseofstaffinitiatedin2005,withaspecificfocuson

teamsdedicatedtoIndianexpatriates.

In2006,SGprivateBankingSuisseisexpectedtocontinueto

poststronglevelsofnetbankingincomeandfundsgathered

asaresultofthesynergiesbetweenthemergedentities(SG

RüeggBankandCompagnieBancaireGenève)andSociété

Générale.

SGBT’sscopecouldgrowagainin2006withthepossible

additionofaprivateBankingbranchinHongkongwhichis

currentlyunderstudy.However,nodatehasbeensetforthe

openingofthebranch.

In2006,allSGBTentitieswillcontinuetobringtheiropera­

tionalandcreditriskmonitoringandmanagementprocesses

intolinewithinternationalcapitaladequacyrequirements(Ba­

selII).progressiscurrentlyinlinewithinitialtimetables.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST22

Consolidatednetincome(aftertax,depreciation,amortizationand

provisions)for2005amountedtoeuR145,686,617compared

witheuR146,996,462in2004,asrecordedintheconsolidated

statementsofprofitandloss.

Consolidated shareholders’ equity

AtDecember31,2005,consolidatedshareholders’equity

amountedtoeuR1,652,372,441afterdistribution.Including

subordinateddebtofeuR126,224,508andeuR17,254,770

inreservesrelatingtoreinvestmentofcapitalgains,totalshare­

holders’equityamountedtoeuR1,795,851,719.

Luxembourg, March 9, 2006

Albert LE DIRAC’H Jean-Charles FERRÉ

Consolidated net income of Société

Générale Bank & Trust Group

■ Market risks at december 31, 2005

Etang blanc

May2004

CarolineDujardin

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST2�

Theorganizationofmarketriskmanagementisconstantly

upgradedwithaviewtoharmonizingexistingcontrolproced­

uresthroughouttheSociétéGénéralegroupandensuringits

completeindependencefromalloperationalfunctions.

Front­lineresponsibilityformanagingmarketrisksnaturally

lieswiththefrontofficemanagersbuttheoverallmarketrisk

controlsystemissupervisedbyanindependentunit,the

MarketRisksDepartment,whichisresponsiblefor:

Dailymonitoring,independentlyfromthefrontoffice,ofthe

positionsandrisksarisingfromallofthemarketactivities,

andcomparisonofthesepositionsandriskswithauthor­

izedlimits,

Definingmethodsformeasuringmarketrisksandestab­

lishingcontrolprocedures,andvalidatingthevaluation

modelsusedtocalculaterisksandresults,

Developingthespecificdatabasesandsystemsrequired

formarketriskassessment,

Reviewingapplicationsformarketrisklimitsreceivedfrom

alloperatingunits,withintheglobalauthorizationsgranted

byGeneralManagement,andmonitoringtheireffective

utilization,

Centralizingandconsolidatingthemarketrisks.

Controllershavebeendesignatedtoimplementthecontrol

proceduresthatrepresentthefirstlevelinthemarketrisk

controlsystem.Themaintasksoftheseriskcontrollers,who

areindependentfromthefrontoffice,include:

Regularmonitoringofpositionsandresultsinliaisonwith

thefrontofficedepartments,

Dailyverificationofthemarketparametersusedtocalcu­

laterisksandresults,

Dailycalculationofmarketrisksbasedonaformal,secure

procedure,

Dailymonitoringofcompliancewiththeexposurelimitsset

foreachactivityandregularverificationthatappropriate

exposurelimitshavebeensetforallactivities.

Inadditiontotheabovesystemofroutinecontrolsovermarket

risks,periodicexaminationsarealsoperformedbySociété

GénéraleBank&Trust’sinternalauditorsandbyauditors

fromtwoofSociétéGénérale’scontrolentities:theCorporate

andInvestmentBankingDivisionauditunitandtheGroup’s

InternalAuditDivision.

SociétéGénéraleBank&Trust’smarketriskmonitoringpolicy

consistsinsettinglimitsforallmarketactivities.Afterap­

provalbySociétéGénérale’sRisksDivision,theselimitsare

releasedbytheManagingDirectorofSociétéGénéraleBank

&Trust.LuxembourgMonetaryInstitutecircularsIML93/101

and95/119establishingregulationsfortheorganizationand

internalcontrolofcreditinstitutions’marketactivitiesrequire

strictsupervisionoftheseactivities.Thetwocircularsalso

establishthattheManagementCommitteeandthemanagers

registeredbytheauthoritiesinaccordancewithLuxembourg

bankinglawassumejointresponsibilityforthepoliciesre­

gardingmarketactivitiesandthequalityoforganizationin

thisarea.

Organization of risk control

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST 2�

ThemarketriskmeasurementsystematSociétéGénérale

Bank&Trustisbasedonacombinationofthreeindicators,

forwhichlimitsareimplemented:

AValueatRisk(VaR)model,withaconfidenceintervalof

99%,whichcomplieswithin­houseregulatoryrequirements.

usingthissyntheticindicator,thebankcanmonitoritsmar­

ketrisk,inparticularintradingbusiness,onadailybasis,

Stress­Testmeasurements,basedonaonce­in­a­decade

riskindicator.Stress­TestmeasurementsenabletheBank

tolimititsexposuretosystemicrisksandthosecausedby

exceptionalmarketmovements,

Additionalsetsoflimits(sensitivity,nominal,etc.)thatensure

consistencybetweenoverallrisklimitsandtheoperational

limitsusedbythefront­officedepartments.Theselimitsare

alsousedtoidentifyandmanagerisksthatwouldnotbe

addressedadequatelybyVaRandStress­Testindicators.

vAluE AT rISK WITH A CoNFIdENCE INTErvAl

oF 99% (vAr)

TheVaRindicatorwasdevelopedattheendof1996andis

beingimprovedcontinuously,notonlythroughtheaddition

ofnewriskfactors,butalsobyextendingthescopeofVaR

monitoring.

Themethodusedisthe“historicsimulation”methodwhich

implicitlytakesintoaccountcorrelationsbetweenthevari­

ousmarketsandtheabnormaldistributiontrendsformed

bydeviationsinmarketparameters.

Themethodisbasedonthefollowingprinciples:

Developmentofhistoricalmarketparametersthatare

representativeoftheriskgeneratedbySociétéGéné­

raleBank&Trust’spositions(interestrates,shareprices,

foreignexchangerates,commoditiesprices,volatilities,

creditspreads,etc.).Alltold,theVaRindicatoriscalculated

basedonnearly10,000riskfactors.

Determinationof250scenarioscorrespondingtodevia­

tionsintheseparametersoveraone­daytimehorizon,

observedoverarollingone­yearperiod,

Adjustmentofone­dayparametersbasedonthesescen­

arios,

Revaluationofdailypositionsbasedonthese250adjusted

one­daytimehorizonmarketparameters.Thisrevaluation

takesintoaccountthenonlinearityofpositions.

TheVaRwitha99%confidenceintervalcorrespondstothe

maximumpotentialriskafterexcludingthe1%chancethat

losseswillexceedthecalculatedamountduringthespecified

period.Basedononeyear’shistoricaldata,i.e.250scen­

arios,itcorrespondstotheaveragebetweenthesecondand

thethirdlargestrisksobserved.

THE METHodoloGICAl lIMITATIoNS oF THE

vAr METHod

TheVaRmeasurementsystemisbasedonamodeland

conventionalassumptions.Asaresult,themainmethodolo­

gicalshortcomingsarethefollowing:

Ituses“one­day”shocks,withtheunderlyingassumption

thatallpositionscanbeliquidatedorhedgedinoneday,

butthisisnotalwaystrueforsomeproductsandincertain

crisissituations.

Itusesa99%confidenceinterval,whichdoesnottake

intoaccountanypotentiallossesabovethislevel.VaRis

thereforeanindicatorofpotentiallossesincurredunder

normalmarketconditionsanddoesnottakeintoaccount

exceptionalmovements.

Methods for measuring market risks and setting exposure limits

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST28

VaRiscalculatedatmarketclose,andintradaymarket

fluctuationsarenottakenintoaccount.

SociétéGénéraleBank&Trusttakesthefollowingstepsto

covertherisksinherentinthemethod:

Systematicevaluationofthemodel’svalidity,bymeansof

back­testing,whichverifiesthatthenumberofdayswith

alossinexcessoftheVaRcomplieswiththe99%confi­

denceinterval.ThishasbeenthecaseeversincetheVaR

methodwasintroduced.Thisback­testingisconducted

foreverybusinessunitsubjectedtoVaRmonitoring.The

processisthereforevalidatedbothattheoverallleveland

atthelevelofeachsub­unit.Fromapurelystatisticalstand­

point,2or3overrunsperyearwouldstillbecompatible

withthe99%confidenceintervalused.

undertaking“Stress­Test”measurementstocomplement

theVaRsystem.

STrESS-TEST METHod

InadditiontotheinternalVaRmethod,SociétéGénérale

Bank&TrusthasdecidedtocontinueusingtheStress­Test

measurementsystemtotakeintoaccountexceptionalmarket

disruption.TheStress­Testmeasurementsystemisbasedon

18historicalscenariosand8theoreticalscenariosincluding

the“theoreticalSociétéGénéralescenario”usedsincethe

early1990s.TogetherwiththeVaRmeasurementsystem,it

isoneofthemajorpillarsoftheriskcontrolsystem.

TheStress­Testriskisbasedonthefollowingprinciples:

Thehistoricalscenariosresultfromasystematicmethodo­

logicalapproachwhichaimstopinpointextremeshocks

thathavetakenplacesince1987onthemaincapitalmar­

ketsandwhicharelikelytoresultinheavylossesforthe

bank.

Thetheoreticalscenariosaredevisedbythebank’seco­

nomistswiththeaimofidentifyingfuturechainsofevents

thatcouldleadtomajormarketcrises.Theyareselected

usingamethodthataimstoincorporateshocksthatare

bothextremeandplausibleandthatcouldhaveanoverall

impactonallmarkets.

Risksarecalculateddailyforeachofthebank’smarket

businesslines,forallproductstakenasawhole,using

eachofthe18historicalscenariosandthe8theoretical

scenarios.

Stress­TestlimitsaresetforSociétéGénéraleBank&

Trust’soverallbusinessandeachofitsvariousbusiness

lines.First,theytakeintoaccounttheworstresultresulting

fromthe26newhistoricalandtheoreticalscenarios.

LiketheVaRmeasurementsystem,thisoverallsystemof

measuringriskusinghistoricalandtheoreticalStress­Test,

constitutesoneofthemajorpillarsoftheregulatorymodel

forcontrollingrisks.

ThevariousStress­Testscenariosarerevisedandaddedto

onaregularbasis,workingwiththeeconomistsofSociété

Généralegroupandthevariousspecialistsundertheaegis

ofSociétéGénéralegroup’sRisksDivision.

Inadditiontotheaboveriskassessmentmethodsandlimits,

marketrisksmustcomplywiththebank’scounterpartrisk

policy.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST 29

SociétéGénéraleBank&Trusthasnocommitmentsoncredit

derivatives,andavoidsusinginstrumentsinvolvinghighcoun­

terpartormarketliquidityrisks.

TheBankdealswithtop­tierOeCDfinancialinstitutions,concen­

tratingitsrisksonbanksintheeuropeaneconomicArea,the

uSA,andCanada.Foroptimumcontrolofthecounterpartrisk

oninterbankcontractsand,inparticular,toavoidsystemicrisk,

SociétéGénéraleBank&Trustplacesgreatimportanceon

usinginternationalmasteragreements,suchastheISDAMaster

Agreement(forderivatives),theFrenchFBF“ConventionCadre”

(forfinancialinstruments,forwardorotherwise),andtheGlobal

MasterRepurchaseAgreement(forsecuritieslending),which

provideforglobalnetting.Theseagreementsprovideprotection

againstdebtorinsolvency,allowingforterminationofcontractual

relationswherenecessary.

TheexposureofSociétéGénéraleBank&Trust’sbondportfolio

mainlyconcernssovereignrisksineucountries,theuSAand,

toalesserextent,Japan.

Counterpart risk policy

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST30

Type of risk Assumptions used Impact at31/12/04

Impact at30/12/05

(*)­categoryAcurrencies:euR,uSD,JpY,CHF,GBp,CAD,AuD,NZD,Dkk,NOk,Sek ­categoryBcurrencies:ISk,kRW,pLN,CZk,SGD,TWD,MxN,HuF,Skk ­categoryCcurrencies:BRL,CNY,HkD,ILS,INR,SIT,THB,ZAR ­categoryDcurrencies:allothercurrencies

Exchangeraterisk Adversemovements,measuredbycurrency,basedon:

Operationalforeign forcurrenciesincategoryA(*): 0.1MeuR 0.1MeuR

exchangepositions movementincurrencyposition:

shorteuRposition:­6%,longeuRposition:+6%

forcurrenciesincategoryB(*):

movementincurrencyposition:

shorteuRposition:­10%,longeuRposition:+6%

forcurrenciesincategoryC(*):

movementincurrencyposition:

shorteuRposition:­15%,longeuRposition:+10%

forcurrenciesincategoryD(*):

movementincurrencyposition:

shorteuRposition:­30%,longeuRposition:+10%

Interestraterisk Adversemovementsininterestratesbycurrencycategory:

sharpupwardmovement:

overnightrate:100%to350%,1­weekrate:60%to300%,

1­yearrate:12%to70%,10­years+rate:8%to50%

sharpdownwardmovement: 4.2MeuR 4.6MeuR

overnightrate:50%to77%,1­weekrate:30%to75%,

1­yearrate:12%to45%,10­years+rate:8%to42%

Société Générale Bank & Trust Luxembourg Market transaction risks

Mare bleue

November2003

CarolineDujardin

■ Consolidated financial statements

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST 3�

TotheBoardofDirectorsofSociétéGénéraleBank&TrustS.A.Luxembourg

FollowingourappointmentbytheBoardofDirectors,wehaveauditedtheaccompanyingconsolidatedfinancial

statementsofSociétéGénéraleBank&TrustS.A.fortheyearendedDecember31,2005andhavereadtherelated

consolidatedmanagementreport.Theconsolidatedfinancialstatementsandtheconsolidatedmanagementreportare

theresponsibilityoftheBoardofDirectors.Ourresponsibilityistoexpressanopinionontheseconsolidatedfinancial

statementsbasedonourauditandtocheckthattheconsolidatedmanagementreportisconsistentwiththem.

WeconductedourauditinaccordancewithInternationalStandardsonAuditing.Thesestandardsrequirethatwe

planandperformtheaudittoobtainreasonableassuranceaboutwhethertheconsolidatedfinancialstatements

arefreeofmaterialmisstatement.Anauditincludesexamining,onatestbasis,evidencesupportingtheamounts

anddisclosuresintheconsolidatedfinancialstatements.Anauditalsoincludesassessingtheaccountingprinciples

usedandsignificantestimatesmadebytheBoardofDirectorsaswellasevaluatingtheoverallconsolidatedfinancial

statementspresentation.Webelievethatourauditprovidesareasonablebasisforouropinion.

Inouropinion,theattachedconsolidatedfinancialstatementsgive,inconformitywiththeLuxembourglegaland

regulatoryrequirementsatrueandfairviewoftheconsolidatedfinancialpositionofSociétéGénéraleBank&Trust

S.A.atDecember31,2005andtheconsolidatedresultsofitsoperationsfortheyearthenended.

Theconsolidatedmanagementreportisconsistentwiththeconsolidatedfinancialstatements.

eRNST&YOuNG

SociétéAnonyme

IndependentAuditor

Jean-Michel PACAUD

Luxembourg, March 9, 2006

Report of the Independent Auditor

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST3�

Theaccompanyingnotesareanintegralpartoftheseconsolidatedfinancialstatements.

ASSETS 2005 2004

Cash, due from central banks and post office accounts 141,678,139 68,316,522

Loans and advances to credit institutions (Notes 4, 10, 28, 34) 9,784,556,786 8,500,261,098

Demand ���,�9�,0�9 ���,3�8,89�

Otherreceivables 9,01�,8�9,�1� 8,0��,882,202

Loans and advances to customers (Notes 4, 10, 34, 35) 10,914,045,804 7,121,839,555

Debt securities and other fixed-income debt securities

(Notes 5, 6, 11, 34) 6,023,566,370 4,764,291,420

Treasurynotesandsimilarsecurities �,889,22�,�90 �,�08,198,30�

Bondsandotherdebtsecurities 1,13�,339,�80 2��,093,11�

Shares and other variable-yield securities (Notes 6, 11) 1,057,477,472 333,030,579

Participating interests (Notes 5, 6, 7) 15,056,261 458,768

Shares in affiliated undertakings (Notes 5, 6, 7, 34, 37) 3,862,456 3,805,747

Shares in affiliated undertakings accounted

for by the equity method (Note 7) 6,527,594 5,750,933

Intangible fixed assets (Note 5) 11,065,183 4,985,776

Goodwil (Note 8) 154,424,311 167,218,813

Currency translation differences - 795,560

Tangible fixed assets (Note 5) 32,544,014 32,894,222

Other assets (Note 9) 61,340,032 39,851,312

Prepayments and accrued income 600,786,798 396,643,719

28,806,931,220 21,440,144,024

Consolidated balance sheet at December 31, 2005 (in EUR)

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST 3�

lIABIlITIES ANd SHArEHoldErS’ EQuITy 2005 2004

Amounts owed to credit institutions (Notes 12, 13, 34) 12,231,138,805 9,545,006,932

Demanddeposits 1,20�,9��,89� �33,108,901

Termdepositsandsubjecttonotice 11,02�,1�0,910 8,911,898,031

Amounts owed to customers (Notes 12, 34) 12,680,573,048 8,236,514,629

Savingsdeposits - ��,�18

Otherdeposits:

Repayableondemand 3,�39,393,8�� 2,18�,3�3,321

Withagreedmaturitydatesorperiodofnotice 9,0�1,1�9,202 �,0�0,10�,�90

Debts evidenced by certificates (Notes 14, 34) 1,076,901,401 979,084,554

Bondborrowings 8�,���,31� ��,2�1,20�

Relatedpayables 992,13�,08� 90�,813,3�8

Other liabilities (Note 15) 94,008,973 178,779,051

Accruals and deferred income 576,728,750 465,962,211

Provisions for liabilities and charges 93,242,845 78,258,828

Provisionsforpensionsandsimilarobligations 9,3�9,239 8,��3,9�8

Provisionsfortaxes(Note32) ��,119,�13 �0,112,332

Otherprovisions(Note1�) 2�,��3,993 29,392,�38

Subordinated debt (Notes 17, 34) 171,946,327 182,639,516

Special items with a reserve quota portion (Note 18) 17,254,770 17,254,770

Fund for general banking risks (Note 19) 2,250,601 2,250,601

Subscribed capital (Note 20) 1,179,042,732 1,179,042,732

Share premium (Note 20) 2,816,416 2,816,416

Consolidated reserves (Note 21) 103,238,421 74,167,413

Minority interests 44,176,419 35,853,142

Currency translation differences 292,981 -

Retained earnings 387,632,060 315,516,767

Net income for the year 145,686,671 146,996,462

Netincome 13�,��8,2�� 138,3��,�0�

Minorityinterests 11,038,�2� 8,��1,0��

28,806,931,220 21,440,144,024

Theaccompanyingnotesareanintegralpartoftheseconsolidatedfinancialstatements.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST38

Theaccompanyingnotesareanintegralpartoftheseconsolidatedfinancialstatements.

2005 2004

Contingent liabilities (Notes 23, 34) 339,235,544 257,738,569

Ofwhich:

[Acceptancesandcommitmentsonendorsements

ofrediscountedbills] [1,019,0��] [�8,29�]

[Guaranteesandassetspledgedascollateral] [110,���,3��] [��,1�9,��9]

Commitments (Notes 24, 34) 1,712,888,375 295,498,730

Fiduciary operations (Note 34) 2,481,486,059 2,253,470,931

Off-balance sheet items at December 31, 2005 (in EUR)

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST�0

2005 2004

Interest and similar income 1,070,681,982 906,971,345

Ofwhich:[Fromfixed-incomesecurities] [1�8,���,990] [13�,��3,�91]

Interest and similar charges (900,268,265) (767,917,726)

Income from securities transactions 40,947,124 56,369,658

Incomefromsharesandothervariable-yieldsecurities 39,983,98� ��,���,9�1

Incomefromparticipatinginterests - �9,289

Incomefromsharesinaffiliatedundertakings 18�,��9 ��,1�8

Sharesinaffiliatedundertakings

accountedforbytheequitymethod ���,��1 81�,2�0

Fee income (Note 29) 293,217,512 236,127,722

Fee expense (Note 29) (101,246,753) (72,748,667)

Net income on financial transactions (15,355,649) (17,747,822)

Other operating income (Note 30) 3,686,071 4,563,888

General administrative expenses (180,164,730) (153,715,500)

Personnelexpenses(Note3�) (12�,3�9,�30) (10�,309,���)

Ofwhich:

[Employeecompensation] [90,2��,�12] [��,���,2�3]

[Socialsecuritybenefitsandpayrolltaxes] [18,�13,112] [1�,330,290]

Ofwhich:

[Pension-relatedbenefitsandtaxes] [�,1��,�92] [3,��2,3�9]

Otheradministrativeexpenses (�2,�9�,100) (��,�0�,9��)

Value adjustments in respect of tangible and intangible asset (Note 5) (7,066,817) (7,364,549)

Goodwill amortization (Note 8) (12,353,041) (12,382,471)

Other operating charges (Note 31) (2,413,919) (1,665,592)

Value adjustments in respect of loans, advances and

provisions for contingent liabilities and commitments (14,812,970) (2,913,837)

Value re-adjustments in respect of loans, advances and

provisions for contingent liabilities and commitments 1,088,928 6,821,169

Theaccompanyingnotesareanintegralpartoftheseconsolidatedfinancialstatements.

Consolidated income statement at December 31, 2005 (in EUR)

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST �1

2005 2004

Value adjustments of securities recorded as financial fixed assets,

shares in affiliated undertakings (11,540) (151,868)

Net exceptional items - (1,604)

Exceptionalincome(Note33) - 23�

Exceptionallosses(Note33) - (1,8�0)

Tax on ordinary and exceptional income (Note 32) (28,955,822) (25,735,587)

Earnings before exceptional items after tax 146,972,121 148,508,559

Other taxes not included in the preceding items (Note 32) (1,285,450) (1,512,097)

Net income before minority interests 145,686,671 146,996,462

Netincome 13�,��8,2�� 138,3��,�0�

Minorityinterests 11,038,�2� 8,��1,0��

Theaccompanyingnotesareanintegralpartoftheseconsolidatedfinancialstatements.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST�2

NoTE 1 – orGANIzATIoN

TheSociétéGénéraleBank&TrustS.A.Group(the“Group”)

preparesitsconsolidatedfinancialstatementsineuros,the

currencyofitssharecapital.Theconsolidatedfinancialstate­

mentsarepreparedonthesamedateastheannualstatutory

financialstatementsofSociétéGénéraleBank&TrustS.A.

(the“Bank”),whichistheparentcompany.

In2005,theBankopenedabranchinSingapore,whichbe­

ganitsoperationsonNovember4,2005furthertoatransfer

inkindoftheprivatebankingbusinessofSociétéGénéralein

Singapore.ThefinancialstatementsoftheBankatDecember

31,2005includethefinancialstatementsoftheSingapore

branch(the“Branch”).

AtDecember31,2005theGrouphadtwobankingsubsid­

iaries:oneinSwitzerland,theotherinMonaco.TheSwiss

subsidiaryinturnhasbranchesinZurichandLausanneas

wellasasubsidiaryinLugano.

NoTE 2 – SIGNIFICANT ACCouNTING PrINCIPlES

2.1. General principles

TheconsolidatedfinancialstatementsoftheGrouphavebeen

drawnupinaccordancewiththeprovisionsoftheFinancial

SectorSupervisoryCommission(CommissiondeSurveillance

duSecteurFinancier−CSSF),andwithapplicablelaw(law

ofJune17,1992relatingtotheannualstatutoryfinancialsta­

tementsandtheconsolidatedfinancialstatementsofbanks

governedbyLuxembourglaw)andregulations,aswellasin

accordancewiththegenerallyacceptedaccountingpractices

forthebankingsectorintheGrandDuchyofLuxembourg.

Thepresentationoftheconsolidatedfinancialstatements

atDecember31,2004hasbeenchangedtomakethem

comparable.

2.2. Consolidation principles

Theconsolidatedfinancialstatementsareestablishedon

thebasisofthefinancialstatementsoftheBankandofthe

LuxembourgandforeigncompaniesmakinguptheGroup,

afterrecognitionofminorityinterests.Sincethefinancialstate­

mentsofforeignsubsidiariesarepreparedusingaccounting

principlesgenerallyacceptedintheirrespectivecountries,

anynecessaryrestatementsandadjustmentsaremadeprior

toconsolidationsothattheycomplywiththeaccountingprin­

ciplesusedbytheGroup(Note2.3.).

a)Consolidationmethods

AllcompaniesincludedintheBank’sscopeofconsolidation

atDecember31,2005and2004,(Note3)andinwhichthe

Bankholdsmorethan50%ofthevotingrightsareconsoli­

datedunderthefullconsolidationmethod.Balancesheet,

off­balancesheetand incomestatement itemsare fully

consolidatedwiththecorrespondingitemsoftheBank.All

intercompanybalancesheet,off­balancesheetandincome

statementtransactionsareeliminatedintheconsolidated

financialstatements.

Theequitymethodisappliedtointerestsincompanies,

otherthanthoseofapurelyfinancialnature,overwhichthe

Groupexercisessignificantinfluence,thatis,companiesin

whichtheGroupholdsbetween20%and50%ofthevoting

rights.

Notes to the consolidated financial statements at December 31, 2005 (in EUR)

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST �3

b)Treatmentofacquisitionsandgoodwill

Goodwillisthedifferencebetweenthepurchasepricepaidby

theBankforaconsolidatedsubsidiaryandtheshareofnet

assetsacquiredonthedateofthefirstconsolidation.

positivegoodwilliscarriedontheassetsideofthebalance

sheetundertheheading“Goodwill”andisamortizedaccord­

ingtoapredefinedplanoverasetperiodbeginningonthe

dateoffirstconsolidationandaccordingtotheassumptions

usedandobjectivessetatthetimeoftheacquisition.The

goodwillrecognizedasofDecember31,2005and2004is

relatedtotheentitySGprivateBanking(Suisse)S.A.(Note

3).Goodwillisamortizedusingthestraight­linemethodover

aperiodoffifteenyearsinsteadoftheusualfiveyearsinorder

topresentafairpictureoftheBank’sresults.Thegoodwill

bookedontheacquisitionsofSociétéImmobilièredel’Arsenal

S.àr.l.andCoparerHoldingB.V.hasbeenclearlyidentified

anddirectlyrecordedunder“Tangiblefixedassets”asgains

ontherevaluationoftheirbuildings.Nogoodwillwasboo­

kedforeuro­VLLuxembourgS.A.,MontalisInvestmentB.V.,

SGBTeuropeanCitiusInvestmentS.A.andSGBTFinance

IrelandLtd,sincetheBank’sequityinterestsweretakenatthe

timethesecompanieswereformed.Moreover,nogoodwill

wasbookedforSGBTMonacoS.A.M.,sincethesharesinthe

latterweresoldin2005totheBankbySGprivateBanking

(Suisse)S.A.attheirnetbookvalue.

NegativegoodwillisrecordedontheLiabilitiessideofthe

consolidatedbalancesheetundertheheading“Negative

goodwill”.

c) Conversionofforeigncurrencyfinancialstatements

Balancesheetandoff­balancesheetitemsofconsoli­

datedcompaniesreporting in foreigncurrenciesare

convertedintoeurosattheofficialexchangeratespre­

vailingatyear­end.

Incomestatementitemsofthesecompaniesaretranslated

intoeurosataverageexchangeratesfortheyear.

Differencesresultingfromtheuseoftwodifferentex­

changeratestovalue,ontheonehand,theconsolidated

companies’balancesheetitemsand,ontheother,their

incomestatementitems,arerecordedunder“Conversion

differences”ontheassetssideofthebalancesheetwhen

theyarepositiveandontheliabilitiesandshareholders’

equitysidewhentheyarenegative.

Theexchangeratesusedfortranslatingbalancesheetand

off­balancesheetitemsofconsolidatedcompaniesreporting

inforeigncurrencieswereasfollows(atDecember31):

2005 2004

1EUR= 1.���1CHF 1.��29CHF

Theaverageexchangeratesusedfortranslatingincome

statementitemsofconsolidatedcompaniesreportingin

foreigncurrencieswereasfollows(atDecember31):

2005 2004

1EUR= 1.��82CHF 1.��2�3CHF

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST��

d)Deferredtaxes

Deferredtaxesarebookedwhenthereisasignificanttiming

differencebetweentherestatedbookvalueandthetaxvalue

ofconsolidatedcompanies’netincome(Note32).

2.3. Accounting principles and valuation methods

TheprincipalaccountingmethodsappliedbytheGroupare

asfollows:

a)Conversionofaccountsandtransactionsdenominated

inforeigncurrencies

TheBankanditsbankingsubsidiarieskeepaccountsin

severalcurrencies,whichinvolvesrecordingeachforeign

currency­denominatedtransactioninaseparateaccountfor

eachcurrency,expressedintermsofpositions.

Theconversionofaccountsdenominatedinforeigncurren­

ciescomplieswiththefollowingcriteria:

Balancesheetitemsareconvertedintoeurosatthespot

exchangeratesprevailingatyear­end.

lncomestatementitemsareconvertedintoeurosatthe

spotexchangeratesprevailingonthedateoftheirbooking

toincome.

unrealizedgainsandlossesonspotforeigncurrencypos­

itionsarerecognizedintheincomestatement,exceptfor

thosearisingonforeignexchangetransactionshedgedvia

theuseofforwardforeignexchangecontracts.

Hedgedspotforeigncurrencypositionsareconsideredto

beneutralwithrespecttoexchangeratefluctuations.Their

conversionhasnoimpactonforeigncurrencygainsand

losses.

ThemainspotexchangeratesusedbytheGroupwereas

follows(atDecember31):

2005 2004

1EUR= 1.1�9�USD 1.3�21USD

1EUR= 1.3�2�CAD 1.��1�CAD

1EUR= 138.90JPY 139.��JPY

1EUR= 1.���1CHF 1.��29CHF

b)Amountsduefrombanksandtobanks,customerloans

anddeposits

Amountsdueondemandcompriseamountsthatcanbe

withdrawnatanytimewithoutnoticeoron24hours’notice.

Termdepositsandborrowingsincludeallamountswhose

residualdurationismorethan24hours.

Amountsduefrombanksandcustomerloansarerecorded

asassetsonthebalancesheetattheiracquisitionprice

lessanyadjustmentsforlossinvalueasdescribedinnote

2.3.g).Amountsduetobanksandcustomerdepositsare

recordedasliabilitiesonthebalancesheetattheirredemp­

tionvalue.

Redemptionpremiumsanddiscountsresultingfromthedif­

ferencebetweenthecontractualamountandtheredemp­

tionamountareaccruedproratatemporisaseitherassets

orliabilitiesundertheheading“Accrualsandsimilar”.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST ��

c)Securitiesportfolio

Bondsandotherfixed­incomedebtsecurities(bonds),shares

andothervariable­incomesecurities(shares),long­termin­

vestmentsecuritiesandinvestmentsinnon­consolidated

subsidiariesandaffiliatesarevaluedinaccordancewiththeir

classificationintothecategoriesdescribedinpoints1),2)

and3)below.

Bondsarecarriedattheirpurchasepriceexcludingacquisition

expensesandinterestaccruedandnotyetdueatthedateof

purchase.Withoutprejudicetosecuritiesissuedatadiscount

(zerocouponbonds),accruedinterestreceivablesincethe

lastcoupondateorthedateofissueisrecordedasanasset

under“Accrualsandsimilar”untilthenextcoupondate.

Sharesarecarriedonthebalancesheetattheirpurchase

priceexcludingacquisitionexpenses.Incomefromthesese­

curitiesisrecordedas“Dividendincome”whenpaid.

TheGroupusestheaverageweightedunitcostmethodfor

valuingitssecuritiesportfolio.

1)Tradingportfolio

Tradingsecuritiesaresecuritieswhichareacquiredwithaview

toresellingthemwithinamaximumperiodofsixmonths.

Atyear­end,bondsarevaluedattheirmostrecentmarket

price.unrealizedgainsandlossesaretakentoincomeand

recordedunder“Netincomefromfinancialtransactions”.

equitysecuritiesarevaluedatthelowestofcostandrealiz­

ablevalue,andinthecaseoflistedsecurities,themostrecent

priceatyear­end.unrealizedcapitalgainsarenotrecognized

intheaccountsbutaprovisionfordepreciationofportfolio

securitiesisbookedtocoverunrealizedcapitallosses.

2)Short­terminvestmentportfolio

Short­terminvestmentsecuritiesarethoseintendedtobeheld

formorethansixmonths,exceptforthoseclassifiedaslong­

terminvestmentsecurities.

Securitiesarevaluedatthelowestofcostandrealizablevalue,

andinthecaseoflistedsecurities,themostrecentpriceat

year­end.unrealizedcapitalgainsarenotrecognizedinthe

accountsbutaprovisionfordepreciationofportfoliosecurities

isbookedtocoverunrealizedcapitallosses.

Whenthepurchasepriceofthebondsintheshort­terminvest­

mentportfolioishigherthantheirredemptionprice,thepositive

differenceisproratedonastraight­linebasisinthe“Accruals

andsimilar”and“Interestandsimilarexpenses”accounts.

3)Long­terminvestmentportfolio

Long­terminvestmentsecuritiesincludelong­termequityin­

vestmentsandinvestmentsinnon­consolidatedsubsidiaries

andaffiliates,withtheexceptionofequityinvestmentsthat

arenotdeemedusefultothebusinessoftheGroupoverthe

longterm.Long­termequityinvestmentsandinvestments

innon­consolidatedsubsidiariesandaffiliatesarerecorded

atcost.Aprovisionfordepreciationofportfoliosecuritiesis

bookedif,intheopinionoftheBoardofDirectors,thereisa

permanentlossofvalue.

Long­terminvestmentsecuritiesincludebondsthatthe

Groupintendstoholduntilmaturity.Bondsinthelong­term

investmentportfolioarerecordedatcostprovidingthey

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST��

meettheregulatoryconditionsthatapplytothiscategory

ofsecuritiesinLuxembourg.Bondsinthiscategorylinked

toaninterestrateswapagreementarerecordedatcost

providingtheymeettheregulatoryconditionsthatapply

tothiscategoryofsecuritiesinLuxembourg.Whenthese

conditionscannotbemet,thebondsarerecordedfollowing

thesameprinciplesasthoseappliedtoshort­terminvest­

mentportfolio.

Noprovisionismadeatyear­endforunrealizedlosseson

securitiescarriedatcost,exceptintheeventofpermanent

lossofvalue.

Whenthepurchasepriceofbondsinthelong­terminvest­

mentportfolioisdifferentfromtheirredemptionvalue,the

negative(orpositive)differenceisamortizedonastraight­line

proratabasisunder“Accrualsandsimilar”and“Interestand

similarincome”(or“Interestandsimilarexpense”).

d)premises,equipmentandotherfixedassets

premises,equipmentandotherfixedassetsarecarriedattheir

purchaseprice.Assetswithalimitedusefullifearedepreciated

usingthestraight­linemethodovertheestimatedusefullifeof

theasset.

Thestraight­linedepreciationratesusedareasfollows:

Start­upcosts: 20­33.3%

Buildings: 4%

Technicalinstallations: 20­33.3%

Otherinstallations,officefurnitureandequipment:10­33.3%

Intheeventofpermanentlossofvalue,fixedassetsaresubject

toprovisionsforadditionaldepreciationtogivethemthelower

valuetoberecordedatyear­end.Theseprovisionsmaybe

reversedifthereasonsforbookingthemceasetoexist.

e) Forwardfinancialinstruments

Commitmentsonforwardfinancialinstrumentsrelatingto

interestrates,currenciesorothermarketratesarerecorded

asoff­balancesheetitemsattheirnominalcontractvalueon

thetransactiondate.

Atyear­end,aprovisionismadeforunrealizedcapitallos­

sesresultingfromtheindividualvaluationatmarketpricesof

thetransactionsthathavenotbeensettled.Thisprovisionis

bookedasaliabilityunder“provisionsforgeneralrisksand

commitments–otherprovisions”.

Noprovisionismadewhenthefinancialinstrumentprecisely

coversanassetorliabilityitemandwheneconomicunityhas

beenestablished,norwhenthefinancialinstrumentishedged

byatransactionintheoppositedirectioneffectivelyclosing

theposition.Revenuesandexpensesonhedgingtransac­

tionsarerecognizedintheincomestatementinthesame

mannerasrevenuesandexpensesonthehedgeditems.

f)provisionsforliabilitiesandcharges

Inadditiontotaxprovisionsandprovisionsforpensionsand

otherpost­retirementbenefits,theseprovisionsnotablyin­

cludeprovisionsforrisksonoff­balancesheettransactions,

provisionsfortheLuxembourgDepositGuaranteeAssocia­

tion(AssociationpourlaGarantiedesDépôts,Luxembourgor

A.G.D.L.)andprovisionsforcontingenciesanddisputes.

TheBankisamemberofLuxembourg’sdepositguarantee

association(AssociationpourlaGarantiedesDépôts,Luxem­

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST ��

bourgA.S.B.L.,orA.G.D.L),whosepurposeistoestablisha

systemformutuallyguaranteeingthecustomerdepositsof

creditinstitutionsthataremembersoftheassociation,regard­

lessofnationalityorresidence.

Inaccordancewithitsbylaws,A.G.D.L.reimbursestodepos­

itorstheamountoftheirguaranteeddepositsandtoinvestors

theamountoftheirguaranteedassets.Themaximumforsuch

guaranteeshasbeensetateuR20,000(oritsequivalent

inaforeigncurrency)percashdepositandateuR20,000

forassetsresultingfrominvestmenttransactionsotherthan

cashdeposits,regardlessofthenumberofaccountsthatthe

customerhasatthesamebank.

g)Valueadjustments

Valueadjustmentsonassetsincludeprovisionsfordoubtful

loans,valueadjustmentsofthesecuritiesportfolio,thelump

sumprovision,depreciationandamortizationofintangible

assetsandpropertyandequipment,andgoodwillonfirst

consolidation.Foragivenasset,negativevalueadjustments

aredeductedfromitsnominalvalueorcost,withtheasset

recordedatitsnetbookvalueonthebalancesheet.

InaccordancewithLuxembourglaw,theBankhasrecorded

ageneralprovisiontocoveritsassetsatrisk.

ThecircularissuedbytheLuxembourgtaxauthoritieson

December16,1997authorizedbankstomakeatax­deduct­

iblegeneralprovisionbasedonallassetsandoff­balance

sheetitemsdeemedtobeatriskwithintheframeworkofthe

prudentialbankingrulesapplicabletothecapitaladequacy

ratio.Theapplicablerateis1.25%basedontheweighted

assetsandoff­balancesheetitemsatrisk.Theseassetsand

off­balancesheetitemsatriskcorrespondto12.5timesthe

shareholders’equityrequiredtocovercredit,commodity

pricevariations,foreignexchangeandmarketrisks.Market

risksincludetradingportfolioexposuresasdefinedbythe

rulesapplicabletothecapitaladequacyratio.

AtDecember31,2005,theLuxembourggeneralprovision

amountedtoeuR58,192,000(2004:euR46,339,295).

Thepartcorrespondingtocreditriskattributedtobalance

sheetitems,i.e.euR55,675,448(2004:euR44,081,541),

wasdeductedfromtheassetsonwhichitwascalculated.

Thebalanceoftheprovision,euR2,516,552(2004:euR

2,257,754),correspondingtocreditriskattributedtooff­bal­

ancesheetitemsandcommoditypricevariations,foreign

exchangeandmarketrisks,wasrecordedasaliabilityunder

“Otherprovisions”.

AtDecember31,2005,thegeneralprovisionofeuR877,612

(2004:euR884,552)onthebooksofSGprivateBanking

(Suisse)S.A.waseliminatedonconsolidation.

Aprovisionequaltotheentireamountofinterestaccrued

andnotyetdueaswellasunpaidinterestondoubtfulloans

ismadeinadditiontotheprovisionfordepreciationofthe

principalamountofdoubtfulloans.

TheGroupnolongerrecordsaccruedinterestandreverses

anyinterestalreadyprovidedforonloansforwhichinterest

paymentscanreasonablybedeemedunlikely.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST�8

Company Country Group ownership interest

Parent company : SociétéGénéraleBank&TrustS.A. Luxembourg 100%

Full consolidation : Banks SociétéGénéraleBank&Trust(Monaco)S.A.M. PrincipalityofMonaco 100%SGPrivateBanking(Suisse)S.A.(Groupe) Switzerland ��.�2%

Financial companies Euro-VLLuxembourgS.A. Luxembourg ��%

Real estate companies SociétéImmobilièredel’ArsenalS.àr.l. Luxembourg 100%CoparerHoldingB.V. Netherlands 100%

Others MontalisInvestmentB.V. Netherlands 9�%SGBTFinanceIrelandLtd Ireland 100%SGBTEuropeanCitiusInvestmentS.A. Luxembourg 99.99%

Companies accounted for by the equity method Insurance companies SogelifeS.A. Luxembourg �9%

NoTE 3 – CoNSolIdATIoN SCoPE

TheconsolidationscopeincludedthefollowingcompaniesatDecember31,2005:

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST �9

SogelifeS.A.wasformedonJuly22,1996asaLuxembourg

limitedliabilitycompany(sociétéanonyme)forthepurposeof

sellinglifeinsuranceproductsandmanaginggrouppension

funds.

SGprivateBanking(Suisse)S.A.isaSwissbankwhichresul­

tedfromthe2003mergerofCompagnieBancairedeGenève

S.A.andSGRüeggBankA.G.,andisprimarilyinvolvedin

privatebanking.

SociétéGénéraleBank&Trust(Monaco)S.A.M.isaMo­

naco­basedbankinthebusinessofprivateBanking.until

December30,2005,SociétéGénéraleBank&Trust(Monaco)

S.A.M.waswhollyownedbySGprivateBanking(Suisse)

S.A..Onthatdate,theBankpurchasedallthesharesheld

bySGprivateBanking(Suisse)S.A..

euro­VLLuxembourgS.A.wasformedonNovember29,

2002.Thepurposeofthiscompanyistoprovideadminis­

trative,distribution,domiciliationandinvestmentproduct

designservices,bothdirectlyandindirectly,tomutualfund

companiesandpensionfunds.

CoparerHoldingB.V.andSociétéImmobilièredel’Arsenal

S.àr.l.arerealestatecompanies.

MontalisInvestmentB.V.,SGBTFinanceIrelandLtdand

SGBTeuropeanCitiusInvestmentS.A.arefinancialcom­

panieswhosemainbusiness istoprovidefinancingto

companies.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST�0

NoTE 4 – loANS ANd dEPoSITS

Thebreakdownbytermtomaturityofdepositsandloansduefrombankswasasfollows(atDecember31):

Thegeographicalbreakdownofloansanddepositsduefrombankswasasfollows(atDecember31,2005):

(in Eur) Gross amount % of total General

provision (1)

other provisions for

possible lossesNet amount

(1)Thegeneralprovisionhasbeenallocatedproportionatelytogrossamountslessotherprovisionsforpossibleerrors.

Eurozonecountries �,2�0,���,0�3 ��.03% (�,�0�,��2) - �,2��,1�2,�11

OtherEuropeanUnioncountries �89,��8,�3� 8.0�% (910,0��) - �88,��8,��8

OtherOECDcountries 923,029,9�� 9.�2% (��1,�23) - 922,2�8,�21

Non-OECDcountries 1,811,10�,�3� 18.�9% (1,�19,0�9) - 1,809,�8�,38�

9,794,261,966 100.00% (9,705,180) - 9,784,556,786

deposits and loans due from banks (in Eur) 2005 2004

Lessthanthreemonths 8,831,13�,�38 �,�80,3��,029

Fromthreemonthstooneyear ��2,�09,100 �3�,0��,823

Fromonetofiveyears 2�9,1�9,982 83,8�1,2��

Morethanfiveyears 21,8�0,1�� -

9,784,556,786 8,500,261,098

AtDecember31,2005,ageneralprovisionofeuR9,705,180

(2004:euR9,218,019),calculatedonaproratabasisbyterm

tomaturityandbasedonthecreditriskattributedtoloans

anddepositsduefrombanks,wasdeductedfromthisasset

account.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST �1

Thebreakdownbytermtomaturityofcustomerloanswasasfollows(atDecember31):

Thegeographicbreakdownofcustomerloanswasasfollows(atDecember31,2005):

(in Eur) Gross amount % of total General

provision (1)

other provisions for

possible lossesNet amount

(1)Thegeneralprovisionhasbeenallocatedproportionatelytogrossamountslessotherallowancesforpossiblelosses.

Eurozonecountries �,3��,018,083 ��.19% (3�,8�3,012) (�,�98,9��) �,32�,���,09�

OtherEuropeanUnioncountries ��2,�81,0�� �.31% (1,�08,319) - ��1,1�2,�2�

OtherOECDcountries 1,1��,��1,�28 10.�1% (1,29�,�99) (1,0��,933) 1,1�2,318,�9�

Non-OECDcountries 1,9�0,�0�,3�2 1�.�9% (�,�1�,��8) (101,31�) 1,9��,888,28�

10,962,875,908 100.00% (42,173,878) (6,656,226) 10,914,045,804

Customers loans (in Eur) 2005 2004

Lessthanthreemonths �,3��,223,01� 3,�33,32�,322

Fromthreemonthstooneyear 2,2�2,��3,��� 1,381,232,�31

Fromonetofiveyears 2,313,9��,9�1 1,3��,��2,��3

Morethanfiveyears 2,001,301,3�2 8�0,�28,829

10,914,045,804 7,121,839,555

AtDecember31,2005,ageneralprovisionofeuR42,173,878

(2004:euR31,522,992),calculatedonaproratabasisby

termtomaturityandbasedonthecreditriskattributedto

customerloans,wasdeductedfromthisassetaccount.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST�2

NoTE 5 – FIxEd ASSETS

Duringtheyear,thefollowingmovementsinfixedassetswererecorded:

(in Eur) Gross book value 2004

Premium/discount Acquisitions disposals Foreign exchange

gain/(loss)Net book

value 2005

Accumulated depre-ciation, amortization

and provisions

Net book value 2005

(1)Thenetbookvalueof“Bonds”notincludedinfixedassetsamountedtoeuR3,802,767,848atDecember31,2005(2004:euR3,336,474,147).

(2)ThenetbookvalueatDecember31,2005of“Investmentsinnon­consolidatedsubsidiariesandaffiliates”notheldforthelongtermamounted

toeuR1,302,832(2004:euR1,184,989)

Bonds (1) 1,428,010,546 (108,133,486) 1,097,361,687 (196,674,254) 685,799 2,221,250,292 (451,770) 2,220,798,522

Long-term equity interests 1,054,004 - 14,592,149 (96,297) (7,078) 15,542,778 (486,517) 15,056,261

Investments in non-consolidated subsidiaries and affiliates (2) 2,622,480 - - (51,850) 2,115 2,572,745 (13,121) 2,559,624

Intangible fixed assets 14,741,003 - 7,957,601 (1,300,476) (41,164) 21,356,964 (10,291,781) 11,065,183

Tangible fixed assets 78,230,529 - 7,702,578 (4,814,031) (184,352) 80,934,724 (48,390,710) 32,544,014Of which : a)Landandbuildings �0,129,�22 - - (3,2�3,0��) (�0,9��) 3�,�8�,�98 (1�,011,0��) 21,���,��3b)Technicalinstallations 1�,81�,�29 - 1,208,282 (3��,1�0) (�3,�09) 1�,�83,1�2 (1�,9�2,�23) 2,�10,�39c)Otherinstallations,officefurnitureandequipment 21,28�,��8 - �,�9�,29� (1,1�3,83�) (�9,8��) 2�,���,0�� (18,�0�,132) 8,1�8,932

Buildingsused foroperationshadanetbookvalueof

euR7,357,097(2004:euR8,057,442).

AtDecember31,2005intangiblefixedassetscomprised

primarilyeuR422,144instart­upcosts(2003:euR416,332)

andeuR19,844,340incostsincurredfortheacquisition

andinstallationofsoftware(2004:euR14,324,671).Accu­

mulateddepreciationandamortizationconsistedprimarilyof

euR332,855(2004:euR191,231)relatedtostart­upcosts

andeuR9,893,948(2004:euR9,563,996)relatedtothe

acquisitionandinstallationofsoftware.Technicalinstalla­

tionscompriseprimarilycomputerhardware.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST �3

(in Eur) Gross book value 2004

Premium/discount Acquisitions disposals Foreign exchange

gain/(loss)Net book

value 2005

Accumulated depre-ciation, amortization

and provisions

Net book value 2005

(1)Thenetbookvalueof“Bonds”notincludedinfixedassetsamountedtoeuR3,802,767,848atDecember31,2005(2004:euR3,336,474,147).

(2)ThenetbookvalueatDecember31,2005of“Investmentsinnon­consolidatedsubsidiariesandaffiliates”notheldforthelongtermamounted

toeuR1,302,832(2004:euR1,184,989)

Bonds (1) 1,428,010,546 (108,133,486) 1,097,361,687 (196,674,254) 685,799 2,221,250,292 (451,770) 2,220,798,522

Long-term equity interests 1,054,004 - 14,592,149 (96,297) (7,078) 15,542,778 (486,517) 15,056,261

Investments in non-consolidated subsidiaries and affiliates (2) 2,622,480 - - (51,850) 2,115 2,572,745 (13,121) 2,559,624

Intangible fixed assets 14,741,003 - 7,957,601 (1,300,476) (41,164) 21,356,964 (10,291,781) 11,065,183

Tangible fixed assets 78,230,529 - 7,702,578 (4,814,031) (184,352) 80,934,724 (48,390,710) 32,544,014Of which : a)Landandbuildings �0,129,�22 - - (3,2�3,0��) (�0,9��) 3�,�8�,�98 (1�,011,0��) 21,���,��3b)Technicalinstallations 1�,81�,�29 - 1,208,282 (3��,1�0) (�3,�09) 1�,�83,1�2 (1�,9�2,�23) 2,�10,�39c)Otherinstallations,officefurnitureandequipment 21,28�,��8 - �,�9�,29� (1,1�3,83�) (�9,8��) 2�,���,0�� (18,�0�,132) 8,1�8,932

Noprovisionsforadditionalpermanentdepreciationwere

recordedin2004or2005.

AtDecember31,2005,ageneralprovisionintheamount

ofeuR368(2004:euR0)calculatedonthecreditriskper­

tainingtoassetswasdeductedfrom“Long­termequityin­

vestments”.

AtDecember31,2005,ageneralprovisionintheamountof

euR1,581(2004–euR1,722)wasdeductedfrom“Invest­

mentsinnon­consolidatedsubsidiariesandaffiliates–held

forthelongterm”.

AtDecember31,2005,euR25,431(2004:euR31,844)were

deductedfrom“Tangiblefixedassets”andareincludedin

“Accumulateddepreciation,amortizationandprovisions”.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST��

NoTE 6 – dEBT SECurITIES, oTHEr FIxEd-INCoME SECurITIES, SHArES ANd oTHEr vArIABlE-

yIEld SECurITIES

AtDecember31,thebreakdownbetweenlistedandunlistedsecuritieswasasfollows:

listed securities (in Eur) 2005 2004

Bonds �,023,���,3�0 �,���,291,�20

Sharesandothervariable-yieldsecurities 2��,112,231 2��,�2�,12�

6,277,678,601 5,019,716,544

unlisted securities (in Eur) 2005 2004

Sharesandothervariable-yieldsecurities 803,3��,2�1 ��,�0�,���

Participatinginterests 1�,0��,2�1 ��8,��8

Sharesinaffiliatedundertakings 3,8�2,��� 3,80�,���

822,283,958 81,869,970

AtDecember31,thebreakdownofbondsbytermtomaturitywasasfollows:

Bonds (in Eur) 2005 2004

Lessthanthreemonths �03,3�1,3�� 2�,��8,1�8

Fromthreemonthstooneyear 9�,���,�18 122,�23,098

Fromonetofiveyears 2,3�8,39�,�0� 2,�9�,039,008

Morethanfiveyears 3,1��,3�2,002 1,920,181,1��

6,023,566,370 4,764,291,420

AtDecember31,2005,investmentsinnon­consolidatedsub­

sidiariesandaffiliatesnotincludedinfixedassetsamounted

toeuR1,317,720(2004:euR1,193,520)(seeNote5).AtDe­

cember31,2005,ageneralprovisionofeuR14,888(2004:

euR8,531),calculatedbasedonthecreditriskattributedto

thecorrespondingassets,wasdeductedfrominvestments

innon­consolidatedsubsidiariesandaffiliatesnotincluded

infixedassets.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST ��

AtDecember31,2005,thebreakdownofBondsbygeographicaloriginwasasfollows:

(in Eur) Gross amount % of total General provision (1)

other provisions for

possible lossesNet amount

(1)Thegeneralprovisionhasbeenallocatedproportionatelytogrossamountslessotherprovisionsforpossiblelosses.

Eurozonecountries �,�9�,2��,�21 92.8�% (�0�,0�2) (2��,2�1) �,�93,282,388

OtherEuropeanUnioncountries 100,8�8,000 1.��% - - 100,8�8,000

OtherOECDcountries 118,233,8�� 1.9�% (12,��8) - 118,221,21�

Non-OECDcountries 212,0�9,9�8 3.�2% (28,9��) (8��,23�) 211,18�,���

6,025,427,564 100.00% (748,687) (1,112,507) 6,023,566,370

(in Eur) Gross amount % of total General provision (1)

other provisions for

possible lossesNet amount

(1)Thegeneralprovisionhasbeenallocatedproportionatelytogrossamountslessotherprovisionsforpossiblelosses.

Eurozonecountries 9��,832,��1 92.28% (2,02�,9��) - 9��,80�,�8�

OtherEuropeanUnioncountries 80,2��,�2� �.��% (1��,��9) - 80,091,1��

OtherOECDcountries 1,�99,122 0.1�% - - 1,�99,122

Non-OECDcountries 82,�91 0.01% - - 82,�91

1,059,671,878 100.00% (2,194,406) - 1,057,477,472

AtDecember31,2005,thebreakdownofSharesbygeographicaloriginwasasfollows:

Accrueddiscountsandpremiumsonbonds inthe long­

terminvestmentportfolioamountedtoeuR628,603and

euR5,827,810respectively,atDecember31,2005(2004:

euR587,828andeuR4,150,533,respectively).

AtDecember31,2005,ageneralprovisionofeuR748,687

(2004:euR108,785),calculatedbasedonthecreditriskattri­

butedtothecorrespondingassets,wasdeductedfrom“Bonds

andotherfixedincomedebtsecurities–Listed”.Ageneral

provisionofeuR525,172(2004:euR1,988,665),calculated

basedonthecreditriskattributedtothecorrespondingassets,

wasdeductedfrom“Sharesandothervariable­yieldsecurities

–Listed”.AsimilargeneralprovisionofeuR1,669,234(2004:

euR608,738)wasdeductedfrom“Sharesandothervariable­

yieldsecurities–unlisted”,euR368(2004:euR0)wasdeducted

from“Long­termequityinvestments–unlisted”andeuR16,469

(2004:euR10,253)wasdeductedfrom“Investmentsinnon­

consolidatedsubsidiariesandaffiliates–unlisted”.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST��

TheGroupheldasinglelong­termequityinvestmentofmorethan20%atDecember31,2005,asbelow:

Company Group ownership interest Acquisition price

Group share of shareholders’ equity at

december 31, 2005

SogelifeS.A.,Luxembourg(accountedforbytheequitymethod) �9 �,123,3�0 �,�2�,�9�

InJuly2003theBankacquired67%ofthesharecapitalof

CompagnieBancairedeGenèveS.A.,aSwissbank,for

CHF324,557,380.Theacquiredcompany’sconsolidated

shareholders’equityatthetimeoftheacquisitionamountedto

CHF158,300,000.Thegoodwillonfirstconsolidationbeforefair

valueadjustmentsthereforeamountedtoCHF218,496,380.

partofthisgoodwill,CHF29,400,000,wasallocatedtoiden­

tifiableitemsintheconsolidatedfinancialstatementsofthe

acquiredentity,notablyincluding“provisionsforgeneralrisks

andcommitments”and“provisionsforexceptionallossin

value”ofcomputerhardware.

Duringthesecondhalfof2003,CompagnieBancairede

GenèveS.A.absorbedSGRüeggBankA.G.whichhadpre­

viouslybeenfullyacquiredbytheBankin1998.Giventhe

termsofthemerger,theBanksubsequentlyowned77.62%

ofthemergedentity,whichwasrenamedSGprivateBanking

(Suisse)S.A..Asacorollarytothismerger,22.38%ofthe

sharecapitaloftheabsorbedentitywasassignedtothemi­

norityshareholdersinCompagnieBancairedeGenèveS.A..

In2004and2005,theinitialacquisitionpricewasmodified

inaccordancewiththecontractualterms.Thebalanceofthe

goodwillonfirstconsolidationthatcouldnotbeallocatedto

identifiableitemsamountedtoeuR154,424,311atDecember

31,2005,asbelow:

AtDecember31,2005,non­materialindividualpositionsmade

upatotalatcostofeuR18,918,717(2004:euR4,264,515)

inlong­termequityinvestmentsandinvestmentsinnon­

consolidatedsubsidiariesandaffiliates.

NoTE 7 – PArTICIPATING INTErESTS, SHArES IN AFFIlIATEd uNdErTAKINGS ANd SHArES IN

AFFIlIATEd uNdErTAKINGS ACCouNTEd For By THE EQuITy METHod

NoTE 8 – GoodWIll

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST ��

Grossamount 18�,29�,�09

FairvalueadjustmentsatDecember31,200� (30,8�1,298)

Net amount 154,424,311

NoTE 9 – oTHEr ASSETS

Otherassetscanbebrokendownasfollows(atDecember31,2005and2004):

(in Eur) 2005 2004

Short-termreceivables 2�,8�8,021 �,�1�,92�

Pensionfundinvestments 1,133,�38 1,3�3,8��

Premiumsonoptionspurchased 29,9�2,319 2�,8��,82�

Preciousmetals ��,212 �1,2��

Other �,330,8�2 �,8�3,�3�

61,340,032 39,851,312

“premiumsonoptionspurchased”comprisesmainlysecuri­

ties­relatedoptionstransactedwithprivatecustomersorfor

thebank’sownaccount.

“Other”intheabovetableincludedeuR2,777,809atDe­

cember31,2005(2004:euR3,142,370)inrecoverablewith­

holdingtaxes.

AgeneralprovisionofeuR36,618,calculatedonthecredit

riskattributedthecorrespondingassets,wasdeductedfrom

otherassetsatDecember31,2005(2004:euR57,332).

Thisgrossamountincludesanetamountatthedateofthe

mergerofeuR7,955,350correspondingtothegoodwillre­

latingtoSGRüeggBankA.G.,afterdeductingtheportion

correspondingtothe22.38%ofitssharecapitalsoldin2003

aspartofthemergertransaction.

AsindicatedinNote2.2.b),goodwillisamortizedoveraperiod

of15years.Ifgoodwillwereamortizedoverfiveyearsinstead

of15years,totalassetsatDecember31,2005wouldhave

beenlowerbyeuR61,776,507.Consolidatednetincomefor

theyearwouldalsohavebeenlowerbyeuR24,706,081.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST�8

NoTE 10 – rEPurCHASE TrANSACTIoNS IN WHICH THE SAlE ANd rEPurCHASE ArE BINdING ANd

THE BANK IS THE BuyING PArTy

Thesetransactionswerenotenteredintowithnon­consolidatedsubsidiariesandaffiliatesandbreakdownasfollows:

(in Eur) 2005 2004

Transactionswithbanks 1,08�,���,8�3 2,081,032,9��

Transactionswithcustomers - 2�,0��,�18

NoTE 12 – lIABIlITIES

Thebreakdownbytermtomaturityofamountsduetobanksbreaksdownaspossible:

Amounts owed to credit institutions (in Eur) 2005 2004

Lessthanthreemonths 10,�12,83�,�99 9,113,99�,�01

Fromthreemonthstooneyear 1,19�,92�,��� ��,��8,9��

Fromonetofiveyears 2��,��2,�83 3�2,�92,�10

Morethanfiveyears �3,�23,8�� 23,9�0,8��

12,231,138,805 9,545,006,932

AtDecember31,2005,theGroupheldeuR1,990,534,195

(2004:euR1,951,305,929)inprimaryfinancialinstruments

belonging to the tradingportfolio. In2005, theGroup

carriedouttransactionsonbehalfofthetradingportfolio

withamaximumpositionofeuR2,299,383,384 (2004:

euR1,962,664,311).

NoTE 11 – PrIMAry FINANCIAl INSTruMENTS (FINANCIAl ASSETS)

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST �9

Thebreakdownbytermtomaturityofcustomerdepositswasasfollows:

Amounts owed to customers (in Eur) 2005 2004

Lessthanthreemonths 11,892,3�3,��� �,���,�38,��9

Fromthreemonthstooneyear ��0,3��,928 3�9,��9,�18

Fromonetofiveyears 30�,28�,113 89,0�0,912

Morethanfiveyears 10,���,��0 10,���,��0

12,680,573,048 8,236,514,629

Customerdepositsatlessthanthreemonthsincludedno demandsavingsdepositsatDecember31,2005(2004:

euR45,718).

(in Eur) due to banks % of total Customer deposits % of total

Eurozonecountries �,92�,83�,08� ��.82% �,���,��8,2�� 3�.13%

OtherEuropeanUnioncountries 893,�8�,389 �.31% 22�,�88,��� 1.�8%

OtherOECDcountries 1,08�,�90,13� 8.8�% �,��3,181,�00 3�.8�%

Non-OECDcountries 2,32�,92�,19� 19.00% 3,32�,8��,32� 2�.2�%

12,231,138,805 100.00% 12,680,573,048 100.00%

AtDecember31,2005,theBankrecordedsaleandrepur­

chasetransactionsunderabindingsaleandrepurchaseagree­

ment.AssetssoldbytheGrouptotaledeuR3,596,933,279

(2004: euR 3,355,967,913, including euR 27,065,518

transactedwithSociétéGénérale,paris).

NoTE 13 – rEPurCHASE TrANSACTIoNS IN WHICH THE SAlE ANd rEPurCHASE ArE BINdING ANd

THE BANK IS THE SEllING PArTy

ThegeographicalbreakdownofamountsduetobanksandcustomerdepositswasasfollowsatDecember31,2005:

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST�0

NoTE 14 – dEBTS EvIdENCEd By CErTIFICATES

ThebreakdownbytermtomaturityofsecuritizeddebtsecuritieswasasfollowsatDecember31,2005and2004:

(in Eur) 2005 2004

Lessthanthreemonths 20�,�3�,�2� 1��,03�,003

Fromthreemonthstooneyear 3�,80�,�21 23,82�,10�

Fromonetofiveyears ��,�1�,3�1 32,132,120

Morethanfiveyears ���,0��,�0� ��9,088,32�

1,076,901,401 979,084,554

NoTE 15 – oTHEr lIABIlITIES

OtherliabilitiesbrokedownasfollowsatDecember31,2005and2004:

(in Eur) 2005 2004

Short-termpayables �1,398,��3 3�,�9�,���

Preferentialpayables �,���,809 �,��9,328

Miscellaneouspayables 11,80�,330 11�,3�0,�8�

Premiumsonsoldoptions 20,1��,�1� 8,301,099

Other 1�,0�8,8�� 11,8�1,���

94,008,973 178,779,051

AtDecember31,2005and2004, “premiumsonsold

options”comprisedprimarilysecurities­relatedoptions

transactedwithprivatecustomersorfortheBank’sown

account.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST �1

NoTE 17 – SuBordINATEd dEBT

TheBankcarriedfoursubordinateddebtsfromaffiliatedcompaniesatDecember31,2005,asfollows:

outstanding Currency Interest rate Maturity

20,000,000 EUR Euribor+0.�% October10,201�

��,22�,�08 EUR Euribor+0.8% December29,2010

�0,000,000 EUR Euribor+0.8% December29,201�

�0,000,000 CHF Libor�month+0.�% November28,2013

TheeuR76,224,508subordinateddebtmayberepaidearly

asfrom2006attheBank’srequestsubjecttothreemonths’

notice.Saidnoticemustbesenttothelenderandtothe

FinancialSectorSupervisoryCommission(Commissionde

SurveillanceduSecteurFinancierorCSSF).IftheCSSF

refusestherequest,thedebtmaynotberepaidearly.

NoearlyrepaymentoftheeuR50,000,000subordinated

debtispossiblebeforeDecember29,2010.Thebankhas

therighttoearlyrepaymentonrequestsubjecttogiving

threemonths’noticetothelenderandtotheCSSF,which

canvetoearlyrepayment.

NoTE 16 – oTHEr ProvISIoNS

OtherprovisionsmainlyincludedthefollowingatDecember31,

2005:

AprovisionforliabilitiesandchargesofeuR3,415,822

(2004: euR 3,954,321) l inked to the valuation of

interest rate swaps included in the tradingportfolio

(Note25),

ThebalanceofeuR2,516,552(2004:euR2,257,754)on

thegeneralprovisioncalculatedonthebasisofthecredit

riskattributedtooff­balancesheetitems,andcommodity

pricevariation,foreignexchangeandmarketrisk,

A provision for litigations of euR 5,309,810 (2004:

euR5,243,821),

TheA.G.D.L.provision(Note2.3.f)ofeuR2,727,111(2004:

euR2,079,211),

AprovisionofeuR1,200,000(2004:euR1,000,000)for

possiblefutureriskslinkedtotheactivityascustodian

andcentraladministratorformutualfundcompanies,in

accordancewithcircularno,2002/77fromtheFinancial

SectorSupervisoryCommission(CommissiondeSur­

veillanceduSecteurFinancier—orCSSF),

AprovisionforcontingentliabilitiesofeuR179,410(2004:

euR0),

AprovisionofeuR5,144,363(2004:euR5,124,241)forthe

restructuringoftheSwissentity.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST�2

Thefirsttwosubordinateddebtslistedintheabovetable

aresubjecttounconditionalsubordinationclauses.Their

repaymentonmaturityissubjecttoCSSFapproval.

TheCHF40,000,000subordinateddebtissuedbytheSwiss

entitymaynotberepaidearlyattherequestoftheborrower

exceptbygivingonemonth’snoticepriortothehalf­yearly

maturitydate.Thisdebtissubjecttosubordinationclauses

inaccordancewithSwissregulations.

TheeuR20,000,000subordinateddebtissuedbytheMo­

nacoentitystipulatesthatitwillberepaidonmaturityonOc­

tober10,2006.Thisdebtcannotberepaidearlyexcepton

theinitiativeoftheborrowerandfurthertothepriorapproval

oftheGeneralSecretaryoftheBankingCommission.The

agreementincludessubordinationclausesinaccordance

withFrenchregulations.

OnMarch31,2005,asprovidedforintheagreement,the

GrouprepaidearlytheeuR30,489,802subordinateddebt

onitsbooksatDecember31,2004.

Interestexpenseonthesesubordinateddebtsamounted

toeuR4,167,405in2005(2004:euR4,826,753).

AtotalamountofeuR126,224,508wasclassifiedasadd­

itionalshareholders’equityatDecember31,2005forthe

purposeofcalculatingthecapitaladequacyratio(2004:

euR156,714,310).

NoTE 18 – SPECIAl ITEMS WITH A rESErvE

QuoTA PorTIoN

InaccordancewithArticle54oftheincometaxlaw,theBank

hadareserveofeuR17,254,770atDecember31,2005(un­

changedfrom2004),comprisingthecapitalgainonthe2002

saleofalong­termequityinterest.

NoTE 19 – FuNd For GENErAl BANKING rISKS

Forreasonsofprudencegiventhespecialrisksinherentto

theBank’sbankingoperations,theBankmaintaineditsgene­

ralreserveforbankingrisksateuR2,250,601atDecember

31,2005unchangedfrom2004.Thesefundsarefullyand

immediatelyavailabletocoverfuturelossesunidentifiedatthe

timeoftheirconstitutionasareserve.Appropriationstothis

reservearemadefromnetincome.

NoTE 20 – SuBSCrIBEd CAPITAl ANd SHArE

PrEMIuM

a)Commonstock

OnMay4,2000,thegeneralshareholders’meetingdecided

toconvert,effectiveJanuary1,2001,thesharecapitalof

LuF7,200,090,459toeurosandincreaseittoeuR179,043,102.

Thiswasdonebyincorporatingpaid­inreservesofeuR557,522.

AtDecember31,2001,thesubscribedsharecapitalamounted

toeuR179,043,102andwasmadeupof1,420,977registered

shareswithanominalvalueofeuR126each.

OnNovember13,2002,thespecialshareholders’meeting

decidedtoincreaseshareholders’equitybyeuR502,815,976,

initiallybyincreasingthesharecapitalbyeuR252,656,208

withacontributioninkindwiththecreationof2,005,208new

shares,andsubsequentlybyincorporatingpartoftheadd­

itionalpaid­incapital,euR247,343,670,intothesharecapital

withthecreationof1,963,045newshares.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST �3

OnOctober6,2004,thespecialshareholders’meetingap­

provedthecapitalincreaseviatheissueof2,507,019new

sharesplusadditionalpaid­incapitalandacashpaymentfor

thecontributionbySogeparticipationS.A.totheBankofare­

presentativeshareofthestockofSGStructuredFinanceIre­

landLtd.TheresultingcapitalincreasewaseuR315,884,394,

theadditionalpaid­incapitalwaseuR184,115,606andthe

cashpaymentwaseuR100,000.

TheallocationoftheeuR184,115,358inadditionalpaid­in

capitalwasalsodecidedbythesamespecialshareholders’

meeting.

Asaresult,atDecember31,2005(unchangedfrom2004)

thepaid­upcommonstockamountedtoeuR1,179,042,732

andwasmadeupof9,357,482shareswithanominalvalue

ofeuR126each.

b)Additionalpaid­incapital

Additionalpaid­incapitalamountedtoeuR2,816,416at

December31,2005(unchangedfrom2004).

(in Eur) 2005 2004

Legalreserve 31,��0,�30 2�,���,�8�

Specialtaxreserve(Note32) �9,832,��� ��,�11,8��

Consolidationreserves 1,8��,0�� 1,210,�82

103,238,421 74,167,413

NoTE 21 – CoNSolIdATEd rESErvES

ConsolidatedreservesbrokedownasfollowsatDecember31:

InaccordancewithlegalrequirementsinLuxembourg,5%of

theBank’snetincomefortheyearmustbeallocatedtoalegal

reserve.Thisallocationisnolongerrequiredoncethereserve

reaches10%ofthesubscribedandpaid­incommonstock.

Thelegalreservecannotbeusedfordividendpayments.

NoTE 22 – ForEIGN CurrENCy-dENoMINATEd ASSETS ANd lIABIlITIES

Thecorrespondingvalueineurosofforeigncurrency­de­

nominatedassets amounted toeuR9,577,939,041at

December31,2005(2004:euR4,345,900,101),andthe

correspondingvalueineurosofforeigncurrency­denomi­

natedliabilitiesamountedtoeuR11,824,631,956(2004:

euR6,552,169,492).

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST��

NoTE 24 – CoMMITMENTS

TheGrouphadenteredintothefollowingtypesoftransactionsfortheindicatedamountsatDecember31:

(in Eur) 2005 2004

Forwardpurchasesofassets 1�,�11,��0 -

Forwardsalesofassets 1�,�11,��0 -

Confirmedcredits,notdrawn 319,23�,3�2 2��,��8,88�

Amountscallableoninvestmentsinnon-consolidatedsubsidiariesandaffiliates 1,12�,��0 1,12�,��0

Settlementofcashtransactions 1,3�9,�0�,1�3 �9,92�,29�

1,712,888,375 295,498,730

AtDecember31,2005,theGrouphadenteredintoforward

transactionsbasedonforeignexchangerates,interestrates

andotherfinancialinstrumentsnotincludedinthetrading

portfolioassummarizedbelow.

NoTE 25 – dErIvATIvE FINANCIAl INSTruMENTS NoT INCludEd IN THE TrAdING PorTFolIo

NoTE 23 – CoNTINGENT lIABIlITIES

ContingentliabilitiesbrokedownasfollowsatDecember31:

(in Eur) 2005 2004

Guaranteesandotherdirectsubstitutesforcredit 8�,833,�92 ��,3�0,��8

Acceptances 1,019,0�� �8,29�

Documentarycredits 22,822,�8� 2,818,982

Counterguarantees 22�,��0,10� 180,�80,�22

339,235,544 257,738,569

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST ��

december 31, 2005 (in Eur) less than 3 months

From 3 months to 1 year

From 1 to 5 years

More than 5 years ToTAl

(*)Thesefinancialassetscorrespondtothenotionalvalueofforeigncurrenciesnotyetreceivedinthecaseofcurrencyinstruments,ortothenotionalvaluesusedasthebasisforcalculatinginterestaccruedbutnotyetreceivedinthecaseofinterestrateinstruments.

Interest rate instruments: 2,710,771,653 1,812,704,422 2,670,013,526 2,986,897,047 10,180,386,648

Interestratecontracts 2,�9�,��1,��3 1,�10,983,��� 2,��0,013,�2� 2,9��,08�,0�� 9,9�2,8�2,8�1

Options 11�,000,000 101,�20,��� - 10,813,000 22�,�33,���

Currency instruments: 14,659,455,434 5,404,933,832 1,236,872,631 100,296,686 21,401,558,583

Currencyfutures 11,93�,���,318 3,9�1,1��,�93 23�,�8�,892 - 1�,132,389,�03

Currencyswaps 91�,23�,��� �91,���,918 9�2,3�9,�9� 100,29�,�8� 2,��0,3�8,���

Options 880,201,3�� 9�2,299,�21 �8,83�,2�2 - 1,881,33�,009

Other 92�,���,30� - - - 92�,���,30�

Instruments based on title deeds: 178,120,863 162,558,784 180,962,535 5,034 521,647,216

Options 1�8,120,8�3 1�2,��8,�8� 180,9�2,�3� �,03� �21,���,21�

ToTAl 17,548,347,950 7,380,197,038 4,087,848,692 3,087,198,767 32,103,592,447

Over­the­countertransactionsenteredintoforpurposesofhedgingfinancialliabilities(*)brokedownasfollowsatDecember31,2005:

december 31, 2005 (in Eur) less than 3 months

From 3 months to 1 year

From 1 to 5 years

More than 5 years ToTAl

(*)Thesefinancialliabilitiescorrespondtothenotionalvalueofforeigncurrenciesnotyetreceivedinthecaseofcurrencyinstruments,ortothenotionalvaluesusedasthebasisforcalculatinginterestaccruedbutnotyetreceivedinthecaseofinterestrateinstruments.

Interest rate instruments: 2,787,771,653 1,812,704,421 2,670,013,526 2,985,684,047 10,256,173,647Interestratecontracts 2,�9�,��1,��3 1,�10,983,��� 2,��0,013,�2� 2,9��,08�,0�� 9,9�2,8�2,8�1Options 192,000,000 101,�20,��� - 9,�00,000 303,320,���

Currency instruments: 14,697,018,359 5,388,063,669 1,225,739,235 100,000,000 21,410,821,263Currencyfutures 11,9�3,2�2,33� 3,9��,123,�9� 23�,�8�,��0 - 1�,1��,881,��3Currencyswaps 918,313,0�� �93,�3�,�29 9�1,�18,2�3 100,000,000 2,��3,3��,���Options 880,201,3�� 93�,303,��3 �8,83�,2�2 - 1,8��,3�0,331Other 92�,231,�13 - - - 92�,231,�13

Instruments based on title deeds: 178,120,863 162,558,784 100,705,713 5,034 441,390,394Options 1�8,120,8�3 1�2,��8,�8� 100,�0�,�13 �,03� ��1,390,39�

ToTAl 17,662,910,875 7,363,326,874 3,996,458,474 3,085,689,081 32,108,385,304

Over­the­countertransactionsenteredintoforthepurposeofhedgingfinancialassets(*)brokedownasfollowsat

December31,2005:

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST��

Interestrateforwardcontractsenteredintoonorganizedmar­

ketshadanotionalvalueofeuR519million,includingeuR

200millionreachingmaturityinthreemonths,euR269million

fromthreemonthstooneyearandeuR50millionin2007.

december 31, 2004 (in Eur) less than 3 months

From 3 months to 1 year

From 1 to 5 years

More than 5 years ToTAl

(*)Thesefinancialassetscorrespondtothenotionalvalueofforeigncurrenciesnotyetreceivedinthecaseofcurrencyinstruments,ortothenotionalvaluesusedasthebasisforcalculatinginterestaccruedbutnotyetreceivedinthecaseofinterestrateinstruments.

Interest rate instruments: 1,299,101,941 701,814,410 2,026,347,249 2,727,584,939 6,754,848,539

Interestratecontracts 1,198,���,��� �3�,��1,2�9 2,02�,3��,2�9 2,�1�,98�,939 �,��9,��1,011

Options 100,���,3�� 1��,3�3,1�1 - 9,�00,000 2��,�0�,�28

Currency instruments: 9,203,975,250 3,976,967,840 761,323,472 98,766,610 14,041,033,172Currencyfutures �,83�,�0�,122 2,�9�,902,883 8�,30�,��9 - 10,�21,913,���

Currencyswaps 3,083,��� ��3,���,��� �19,���,03� 98,���,�10 1,3��,9�1,�93

Options �0�,�1�,�03 �2�,�19,�82 ��,��2,��8 - 1,28�,�0�,��3

Other ��8,��1,1�2 - - - ��8,��1,1�2

Instruments based on title deeds: 159,484,795 262,473,551 141,962,515 - 563,920,861 Options 1�9,�8�,�9� 2�2,��3,��1 1�1,9�2,�1� - ��3,920,8�1

ToTAl 10,662,561,986 4,941,255,801 2,929,633,236 2,826,351,549 21,359,802,572

Over­the­countertransactionsenteredintoforthepurposeofhedgingfinancialassets(*)brokedownasfollows(at

December31,2004):

AtDecember31,2004,theGrouphadenteredintoforwardtransactionsbasedonforeignexchangerates,interestratesand

otherfinancialinstrumentsassummarizedbelow.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST ��

Over­the­countertransactionsenteredintoforpurposesofhedgingfinancialliabilities(*)brokedownasfollows(at

December31,2004):

(in Eur) less than 3 months

From 3 months to 1 year

From 1 to 5 years

More than 5 years ToTAl

(*)Thesefinancialliabilitiescorrespondtothenotionalvalueofforeigncurrenciesnotyetreceivedinthecaseofcurrencyinstruments,ortothenotionalvaluesusedasthebasisforcalculatinginterestaccruedbutnotyetreceivedinthecaseofinterestrateinstruments.

Interest rate instruments : 1,299,101,941 701,814,410 2,026,347,249 2,727,584,939 6,754,848,539

Interestratecontracts 1,198,���,��� �3�,��1,2�9 2,02�,3��,2�9 2,�1�,98�,939 �,��9,��1,011

Options 100,���,3�� 1��,3�3,1�1 - 9,�00,000 2��,�0�,�28

Currency instruments: 9,277,568,176 4,021,529,100 783,045,312 100,000,000 14,182,142,588

Currencyfutures �,910,�2�,�11 2,�93,�8�,��0 8�,199,�0� - 10,�91,210,3�8

Currencyswaps 3,�80,3�9 �01,�2�,1�8 ��1,2�3,02� 100,000,000 1,���,3��,���

Options �0�,�1�,�03 �2�,�19,�82 ��,��2,��8 - 1,28�,�0�,��3

Other ��9,0��,883 - - - ��9,0��,883

Instruments based on title deeds: 143,117,437 226,388,097 51,142,762 - 420,648,296

Options 133,20�,2�0 22�,388,09� �1,1�2,��2 - �10,�3�,129

Other 9,911,1�� - - - 9,911,1��

ToTAl 10,719,787,554 4,949,731,607 2,860,535,323 2,827,584,939 21,357,639,423

Interestrateforwardcontractsenteredintoonorganized

marketshadanotionalvalueofeuR300million,including

euR150millionreachingmaturityfromthreemonthstoone

yearandeuR150millionin2006.

AtDecember31,2005and2004,theBankentersintoforwardcurrencyandcurrencyoptiontransactionsforthepurpose

ofhedgingtransactionsconcludedwithbankingcounterparties.Alltransactionsinitiatedbycustomersaresystematically

hedgedonthemarket.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST�8

AtDecember31,2005,theGrouphadenteredintoforward

transactionsbasedonforeigninterestratesincludedinthe

tradingportfolioassummarizedbelow.

Tradingtransactionsonfinancialassetsandliabilitiesareen­

teredintooverthecounter.

Inthefollowingtables,contractswithapositiveornegative

replacementvalueatDecember31areconsideredtobe,

respectively,financialassetsorfinancialliabilities.

BrEAKdoWN oF dErIvATIvE FINANCIAl INSTruMENTS IN THE TrAdING PorTFolIo AT dECEMBEr 31, 2005 (IN Eur)

ovEr-THE-CouNTEr less than three months From three months to one year From one to five years More than five years Total

Financial assets Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value

ovEr-THE-CouNTEr less than three months From three months to one year From one to five years More than five years Total

Financial liabilities Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value

Interest rate instruments 2,886,722,769 48,069,580 5,512,727,117 172,054,592 4,635,956,561 388,848,667 1,051,531,659 89,021,877 14,086,938,106 697,994,716

ToTAl 2,886,722,769 48,069,580 5,512,727,117 172,054,592 4,635,956,561 388,848,667 1,051,531,659 89,021,877 14,086,938,106 697,994,716

Interest rate instruments 10,067,579,602 105,240,415 6,624,145,658 191,717,365 3,625,880,424 258,355,505 1,061,531,659 90,820,764 21,379,137,343 646,134,049

ToTAl 10,067,579,602 105,240,415 6,624,145,658 191,717,365 3,625,880,424 258,355,505 1,061,531,659 90,820,764 21,379,137,343 646,134,049

BrEAKdoWN oF dErIvATIvE FINANCIAl INSTruMENTS IN THE TrAdING PorTFolIo AT dECEMBEr 31, 2004 (IN Eur)

ovEr-THE-CouNTEr less than three months From three months to one year From one to five years More than five years Total

Financial assets Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value

ovEr-THE-CouNTEr less than three months From three months to one year From one to five years More than five years Total

Financial liabilities Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value

Interest rate instruments 3,486,829,497 1,276,934 3,376,031,511 11,656,277 1,439,761,459 11,490,226 33,000,059 2 8,335,622,526 24,423,439

ToTAl 3,486,829,497 1,276,934 3,376,031,511 11,656,277 1,439,761,459 11,490,226 33,000,059 2 8,335,622,526 24,423,439

Interest rate instruments 4,871,476,399 1,408,377 3,553,054,499 12,689,716 1,552,389,396 11,215,115 33,000,059 2 10,009,920,353 25,313,210

ToTAl 4,871,476,399 1,408,377 3,553,054,499 12,689,716 1,552,389,396 11,215,115 33,000,059 2 10,009,920,353 25,313,210

NoTE 26 – dErIvATIvES INCludEd IN THE TrAdING PorTFolIo

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST �9

AtDecember31,2005,interestrate­relatedtransactionsin­

cludedalargeportfolioofinterestrateswapsenteredintoby

theGroupwithintheframeworkofitsdynamicmanagement

ofitstransformationpositionor,ofitstradinginshort­dated

securitiesclassifiedinthetradingportfolioforthetotalamount

ofeuR35,466,075,449(2004:euR18,345,542,879).This

portfolioofinterestratesswapsisclassifiedinthetrading

portfolioandnotablyincludestransactionsorthesaleand

purchaseofinterestrateswapsbasedonsimilarperiodsand/

orcurrencies.Theirvaluationattheprevailinginterestratesat

theendofyearresultsinanunrealizedlossofeuR3,415,822

(2004:euR3,954,321)whichwasrecordedunder“Otherpro­

visions“(Note16).

BrEAKdoWN oF dErIvATIvE FINANCIAl INSTruMENTS IN THE TrAdING PorTFolIo AT dECEMBEr 31, 2005 (IN Eur)

ovEr-THE-CouNTEr less than three months From three months to one year From one to five years More than five years Total

Financial assets Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value

ovEr-THE-CouNTEr less than three months From three months to one year From one to five years More than five years Total

Financial liabilities Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value

Interest rate instruments 2,886,722,769 48,069,580 5,512,727,117 172,054,592 4,635,956,561 388,848,667 1,051,531,659 89,021,877 14,086,938,106 697,994,716

ToTAl 2,886,722,769 48,069,580 5,512,727,117 172,054,592 4,635,956,561 388,848,667 1,051,531,659 89,021,877 14,086,938,106 697,994,716

Interest rate instruments 10,067,579,602 105,240,415 6,624,145,658 191,717,365 3,625,880,424 258,355,505 1,061,531,659 90,820,764 21,379,137,343 646,134,049

ToTAl 10,067,579,602 105,240,415 6,624,145,658 191,717,365 3,625,880,424 258,355,505 1,061,531,659 90,820,764 21,379,137,343 646,134,049

BrEAKdoWN oF dErIvATIvE FINANCIAl INSTruMENTS IN THE TrAdING PorTFolIo AT dECEMBEr 31, 2004 (IN Eur)

ovEr-THE-CouNTEr less than three months From three months to one year From one to five years More than five years Total

Financial assets Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value

ovEr-THE-CouNTEr less than three months From three months to one year From one to five years More than five years Total

Financial liabilities Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value Notional value Fair value

Interest rate instruments 3,486,829,497 1,276,934 3,376,031,511 11,656,277 1,439,761,459 11,490,226 33,000,059 2 8,335,622,526 24,423,439

ToTAl 3,486,829,497 1,276,934 3,376,031,511 11,656,277 1,439,761,459 11,490,226 33,000,059 2 8,335,622,526 24,423,439

Interest rate instruments 4,871,476,399 1,408,377 3,553,054,499 12,689,716 1,552,389,396 11,215,115 33,000,059 2 10,009,920,353 25,313,210

ToTAl 4,871,476,399 1,408,377 3,553,054,499 12,689,716 1,552,389,396 11,215,115 33,000,059 2 10,009,920,353 25,313,210

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST�0

Thecreditriskrelatingtoderivativeinstrumentsnottraded

onthestockmarket,atDecember31,2005and2004,is

detailedinthefollowingtablewhoseheadingsaredefined

asfollows:

Notionalamountscorrespondtotheamountsrecordedfor

eachcontractenteredintowithathirdparty.Inthecase

ofexchangeratecontracts,thetableincludesonlythose

thathavenotmaturedwithin15daysofyear­end.

Replacementvaluesarecalculatedusingamethodbased

ontheassumptionthatsincetheprimarymarketissuf­

ficientlyliquid,itispossibleatalltimestofindaproduct

identicaltotheonethatisbeingvalued.Thiswouldthen

makeitpossibleto“turn”thetransaction,i.e.toenterintoa

symmetricaltransaction.Thedifferencesinthecashflows

generatedbythetwocontracts(realandfictitious)aredis­

countedtopresentvalueatmarketrates.Onlythecurrent

replacementvaluesofthecontractsthathaveapositive

valueareincludedinthetable.Acontractissaidtohave

apositivevalueif,whenvaluedatcurrentmarketrates,it

generatesareplacementvalue.

potentialfuturereplacementvaluesarecalculatedbymul­

tiplyingthenotionalamountsbyaconversionfactorthat

variesasafunctionofboththenatureofthecontractsand

theirtermtomaturity.TheCSSFdefinedtheconversion

factorsusedinthetable.

Netexposuretoriskisthesumofcurrentandpotential

futurereplacementvalues.Noguaranteeshavebeende­

ductedsincetheBankhasnospecificthird­partyguaran­

teesonthesecontractsalthoughitisoftenprotectedby

masteragreements.

Thefollowingtablesdonottakeintoaccounttransactions

wheretheweightingattributedtothecounterpartyorthe

guarantorisnil.

NoTE 27 – CrEdIT rISK oN dErIvATIvE INSTruMENTS NoT TrAdEd oN THE SToCK MArKET

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST �1

december 31, 2005 (in Eur) Notional amount replacement value

Potential future replacement

values

Net exposure to risk

Interest rate contracts – Banks

<1year Eurozone 1�,009,�2�,19� 3�,09�,10� - 3�,09�,10�

Canada 1�9,�3�,�2� 2,�21,10� - 2,�21,10�

UnitedKingdom 12,��3,31�,23� 2�,���,128 - 2�,���,128

UnitedStates 1,��8,193,��0 �,�12,�13 - �,�12,�13

Switzerland 2�,�21,819 32,1�1 - 32,1�1

Other �2,383,��� 12�,822 - 12�,822

29,398,778,173 66,643,034 - 66,643,034

1-�years Eurozone 3,�33,18�,�9� 31,0�1,289 1�,���,933 �8,�0�,222

Canada �2,383,��� ��1,3�� 211,918 ��3,2��

UnitedKingdom �,�39,032,122 2�,���,��� 28,�9�,1�1 �3,��0,81�

UnitedStates �13,1��,892 3,139,192 3,0��,82� �,20�,01�

9,927,767,367 59,487,482 49,638,836 109,126,318

>�years Eurozone 2,�1�,�3�,299 �1,�2�,��� 39,23�,��9 80,��0,22�

UnitedStates 1�,�3�,382 - 2��,��� 2��,���

UnitedKingdom �8�,���,�3� 8��,2�1 10,311,9�� 11,1�9,218

3,319,538,116 42,382,917 49,793,072 92,175,989

ToTAl 42,646,083,656 168,513,433 99,431,908 267,945,341

Currency contracts – Banks

<1year Eurozone 3,3�9,208,�8� 21,38�,�29 33,�92,088 ��,0�8,�1�

Switzerland 2,�22,���,�2� 10,321,18� 2�,22�,��� 3�,��8,8�0

Canada �8,912,�0� 3,9�2,212 �89,12� �,��1,338

UnitedKingdom 2,�39,��3,��� �1,089,108 2�,39�,�3� 88,�8�,���

Japan �0,81�,000 - �08,1�0 �08,1�0

UnitedStates ��0,830,�2� 9,1�9,80� �,�08,30� 1�,��8,113

Other 1,�93,�8�,�89 12,1�2,322 1�,93�,8�� 28,108,199

11,095,884,907 118,101,162 110,958,849 229,060,011

1-�years Eurozone 289,9�1,22� 3,�99,09� 1�,�98,��1 18,19�,���

UnitedKingdom �1�,3�1,003 8,���,3�0 3�,8�8,��0 ��,�1�,910

Switzerland �8,9�1,188 38,�38 2,9�8,0�9 2,98�,�9�

1,066,303,417 12,383,894 53,315,170 65,699,064

>�years Eurozone 100,296,686 172,134 7,522,251 7,694,385

ToTAl 12,262,485,010 130,657,190 171,796,270 302,453,460

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST�2

december 31, 2005 (in Eur) Notional amount replacement value

Potential future replacement

values

Net exposure to risk

Interest rate contracts – Customers

>1year Eurozone 1�,000,000 - - -

Switzerland 32,1�2,2�3 - - -

49,152,273 - - -

1-�years Eurozone 10,2��,8�� - �1,28� �1,28�

Other 99�,000,000 20,8�1,39� �,9��,000 2�,83�,39�

1,005,256,845 20,861,394 5,026,284 25,887,678

>�years Eurozone 33�,��3,2�2 - �,033,�99 �,033,�99

Other 2,119,183 - 31,�88 31,�88

337,692,435 - 5,065,387 5,065,387

ToTAl 1,392,101,553 20,861,394 10,091,671 30,953,065

Currency contracts – Customers

<1year Eurozone 2,�8�,�81,200 3�,8�8,�8� 2�,8��,812 ��,�2�,�98

UnitedKingdom 3�,1�8,3�0 �,��� 3�1,�8� 3��,1�9

Switzerland 8,�8�,�88 - 8�,8�� 8�,8��

Japan ��,33�,�0� - ��3,3�� ��3,3��

Other 8��,�82,2�� �,988,2�2 8,���,822 13,���,08�

3,648,432,179 42,862,613 36,484,322 79,346,935

1-�years Eurozone 119,626,032 2,840,548 5,981,302 8,821,850

ToTAl 3,768,058,211 45,703,161 42,465,624 88,168,785

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST �3

december 31, 2004 (in Eur) Notional amount replacement value

Potential future replacement

values

Net exposure to risk

Interest rate contracts – Banks

<1year Eurozone 8,���,�98,980 18,11�,031 - 18,11�,031

Canada 10�,3��,�3� 81�,213 - 81�,213

UnitedKingdom �,222,22�,8�� 1�,��8,8�0 - 1�,��8,8�0

UnitedStates 882,2��,3�3 �,0��,218 - �,0��,218

Switzerland 1��,832,09� - - -

17,022,500,728 39,744,322 - 39,744,322

1-�years Eurozone 2,�9�,01�,9�1 21,322,�8� 12,9��,080 3�,29�,���

UnitedKingdom 2,1�9,9��,1�1 1�,131,1�� 10,899,881 2�,031,028

UnitedStates 19�,099,�81 2��,99� 9�0,�9� 1,218,�91

4,969,091,593 35,701,827 24,845,458 60,547,285

>�years Eurozone 2,2�9,309,213 3�,�80,9�2 33,�39,�38 �9,220,�90

UnitedKingdom �01,���,�83 101,�9� �,�2�,13� �,�2�,83�

2,750,984,996 35,582,649 41,264,775 76,847,424

ToTAl 24,742,577,317 111,028,798 66,110,233 177,139,031

Currency contracts – Banks

<1year Eurozone 2,3�3,���,393 �1,���,�18 23,�3�,��� 9�,113,2�2

Switzerland 82�,2�3,��� 18,9��,��� 8,2�2,�3� 2�,239,1�9

Canada 2�0,399,�39 �,�91,3�� 2,�03,99� 9,99�,339

UnitedKingdom 3,28�,01�,219 111,�0�,�90 32,8�0,1�2 1��,���,�32

Japan 21,�82,2�� 381,�80 21�,823 �9�,�03

UnitedStates 120,3��,3�1 13,�3�,12� 1,203,��� 1�,839,��9

Other 1,0�3,9��,��3 11,8��,�2� 10,�39,��� 22,�0�,202

7,922,146,877 235,524,527 79,221,469 314,745,996

1-�years Eurozone ���,8�9,�30 2��,�9� 2�,8�3,9�� 28,091,��2

UnitedKingdom �2�,913,0�2 1,2��,�8� 31,29�,��3 32,��1,139

1,182,792,592 1,503,081 59,139,630 60,642,711

>�years Eurozone 98,766,610 - 7,407,496 7,407,496

ToTAl 9,203,706,079 237,027,608 145,768,595 382,796,203

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST��

december 31, 2004 (in Eur) Notional amount replacement value

Potential future replacement

values

Net exposure to risk

Interest rate contracts – Customers

1-�years Eurozone 1�,000,000 8�,000 - 8�,000

Switzerland 32,�0�,�0� 1�2,033 - 1�2,033

49,406,507 247,033 - 247,033

>�years Eurozone 33,000,059 - 495,001 495,001

ToTAl 82,406,566 247,033 495,001 742,034

Currency contracts – Customers

<1year Eurozone 1,99�,239,9�2 �,0�0,3�9 19,9�2,�00 2�,022,��9

UnitedKingdom 2�,189,3�1 98�,129 2�1,89� 1,22�,023

2,020,429,323 5,045,478 20,204,294 25,249,772

1-�years Eurozone 50,340,893 - 2,517,045 2,517,045

ToTAl 2,070,770,216 5,045,478 22,721,339 27,766,817

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST ��

NoTE 28 – FIduCIAry oPErATIoNS

Totalassetsandliabilitiesarisingonfiduciaryoperations

outsidetheGroupnotincludedinthecorrespondingoff­

balancesheetaccountseachamountedtoeuR768,084,358

atDecember31,2005(2004:euR873,319,706).

NoTE 29 – MANAGEMENT ANd rEPrESENTATIoN

SErvICES

AtDecember31,2005and2004,Feeincomeandexpense

relateprimarilytotheprovisionofmanagementandrepresen­

tationservices.TheGroupprovidesitscustomerswiththese

servicesinthefollowingareas:

Wealthmanagement

Investmentadvice

Securitiescustodyandadministration

Centraladministrationrelativetoinvestmentfunds

Safe­depositboxrentals

Fiduciaryrepresentation

Agencyfunctions.

NoTE 30 – oTHEr oPErATING INCoME

AtDecember31,2004andDecember31,2005,otherope­

ratingincomecomprisedahostofnon­materialbalances

resultingfromtheGroup’snormaloperationsandthereversal

ofprovisionssetasidefordisputes.AtDecember31,2004,

otheroperatingincomealsoincludedthereversalofaprovi­

sionforfuturerisksrelatingtothemutualfundcustodianbank

activity,pursuanttoCSSFCircular2002/77(Note16).

NoTE 31 – oTHEr oPErATING CHArGES

Forboth2005and2004,otheroperatingchargescomprised

provisionsformiscellaneousdisputesrelatingtocustomer

claimsandotherprovisionsforgeneralrisksandcommitments

(Note16).For2005,otheroperatingchargesalsoincludedan

allocationtoprovisionsfortheA.G.D.L.(Note16).

NoTE 32 – INCoME TAx

TheBankissubjecttoalltaxesthatapplytoLuxembourg

banks.FinaltaxassessmentshavebeenmadeontheBank

upto1998.TheSingaporebranchissubjecttothetaxesthat

applyinSingapore.

In2005,thewealthtaxduefromtheBankfortheyearended

wasreducedbyeuR7,841,035(2004:euR4,484,180).Inorder

toqualifyforthetaxreductionsin2005and2004,theBank

committedtocreating,andthenmaintainingforfiveyears,a

specialreserveforwealthtaxreductionequaltofivetimesthe

amountofthereduction.Ifpartofthisreserveisusedbefore

theendofthefive­yearperiod,theBank’swealthtaxcharge

forthatyearwillbeincreasedby20%oftheamountused.

TheBank’sSwissentitiesaresubjecttoallSwisstaxeson

banks,inaccordancewiththetaxtreatybetweenSwitzerland

andLuxembourg.

Thecompaniesincludedintheconsolidationscopearesub­

jecttothetaxesapplicableinthecountriesinwhichtheyare

based(Note3).

TheGroupbookeddeferredtaxesintheyearsendedDecem­

ber31,2005and2004.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST��

NoTE 33 – ExCEPTIoNAl INCoME ANd loSSES

NetexceptionalitemsfortheyearendedDecember31,2004

werenotmaterial.

BAlANCE SHEET ITEMS ASSETS (in Eur) 2005 2004

loans and advances to credit institutions 6,931,876,042 5,174,016,513Demanddeposits ��9,000,10� 2��,8�3,1�0Otherreceivables �,��2,8��,93� �,898,1�3,3�3

loans and advances to customers 6,306,486,493 4,551,682,107

debt securities and other fixed-income securities 103,071,705 3,188,528

Shares in affiliated undertakings 3,890,465 3,816,000

ToTAl 13,345,324,705 9,732,703,148

NoTE 34 – AFFIlIATEd CoMPANIES

Consolidatedbalancesheetandoff­balanceitemsincludedthefollowingtransactionswithaffiliatedcompanies(atDecember31,

grossamountsbeforegeneralprovisions):

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST ��

BAlANCE SHEET ITEMS lIABIlITIES (in Eur) 2005 2004

Amounts owed to credit institutions 8,647,485,331 6,363,213,420Demanddeposits ��2,�10,880 ��2,01�,��9Termdepositsandsubjecttonotice �,88�,9��,��1 �,801,19�,��1

Amounts owed to customers 473,901,195 62,399,554Otherdeposits– Demanddeposits 21,���,�3� 18,09�,901Termdepositsandsubjecttonotice ��2,2��,��0 ��,302,��3

Debts evidenced by certificates 138,824,291 208,007,570

Subordinated debt 171,946,327 182,639,516

ToTAl 9,432,157,144 6,816,260,060

oFF-BAlANCE SHEET ITEMS (in Eur) 2005 2004

Contingent liabilities 67,069,304 19,426,678

Commitments 608,745,325 26,972,457

Foreign currency-related transactions: 2,244,343,812 1,111,864,771Forwardforeignexchangetransactions 1,29�,���,198 �00,��1,208Crosscurrencyinterestrateswaps �88,�00,�9� 8�,0��,��0Options–OTC ��2,��9,9�� 320,222,2��Other 1�,�99,0�2 �,1��,���

Interest rate-related transactions: 9,061,678,585 3,653,461,057Interestrateswaps 9,0�0,8��,�8� 3,�8�,103,12�Options–OTC 10,813,000 ��,3��,930

Other market-related transactions: 128,459,719 155,939,054Variable-incomesecurities–Options–OTC 128,��9,�19 1��,939,0��

Fiduciary operations 404,971,796 374,970,700

ToTAl 12,515,268,541 5,342,634,717

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST�8

NoTE 35 – PErSoNNEl

TheGrouphadanaverageof1,272employeesin2005,com­

paredwith1,028in2004.personnelbrokedownintothe

followingcategories(atDecember31):

Category

Number

2005 2004

Generalmanagement 9 �

Executives 3�0 288

Otheremployees 903 �3�

TotalcompensationpaidtoGeneralManagementinres­

pectoftheyearendedDecember31,2005amountedto

euR1,684,605(2004:euR1,211,729).

Nopensioncommitmentsweremadetoformermembersof

GeneralManagementineither2005or2004.

AtDecember31,2005,therewerenomortgageloansto

membersofManagement(2004:euR150,000).

NoTE 36 – lArGEST SHArEHoldEr oF THE

PArENT CoMPANy

SociétéGénérale,whoseheadofficeislocatedat29,bou­

levardHaussmann,75009paris,France,andwhichwas

thelargestgroupofcompaniesofwhichtheGroupwasa

subsidiary,consolidatedthefinancialstatementsofallGroup

companies,withtheexceptionofCoparerHoldingB.V.,for

theyearsendedDecember31,2005and2004.

Sogeparticipations,whoseheadofficeislocatedat29,bou­

levardHaussmann,75009paris,France,consolidatedthe

financialstatementsoftheBankfortheyearsendedDecem­

ber31,2005and2004.Sogeparticipationswasthesmallest

groupofcompaniesofwhichtheBankwasasubsidiaryand

wasitselfasubsidiaryofthelargestgroupofcompaniesmen­

tionedabove.

Theconsolidatedfinancialstatementsmentionedaboveare

availableattheheadofficesoftheindicatedcompanies.

NoTE 37 – NoN-CoNSolIdATEd CoMPANIES

InaccordancewithArticle83ofthelawofJune17,1992,as

amended,relatingtotheannualandconsolidatedfinancial

statementsofLuxembourgbanks,certaincompanieshave

notbeenincludedintheconsolidationscopeduetotheir

negligiblesizewithrespecttopresentingafairpictureofthe

annualconsolidatedfinancialstatements.

le pin

April2004

CarolineDujardin

■ Abridged version of the parent company financial statements

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST 83

TotheBoardofDirectorsofSociétéGénéraleBank&TrustS.A.

FollowingourappointmentbytheBoardofDirectors,wehaveauditedtheaccompanyingfinancialstatements

ofSociétéGénéraleBank&TrustS.A.fortheyearendedDecember31,2005andhavereadtherelatedman­

agementreport.ThefinancialstatementsandmanagementreportaretheresponsibilityoftheBoardofDirectors.

Ourresponsibilityistoexpressanopiniononthesefinancialstatementsbasedonourauditandtocheckthatthe

managementreportisconsistentwiththem.

WeconductedourauditinaccordancewithInternationalStandardsonAuditing.Thesestandardsrequirethat

weplanandperformtheaudittoobtainreasonableassuranceaboutwhetherthefinancialstatementsarefreeof

materialmisstatement.Anauditincludesexamining,onatestbasis,evidencesupportingtheamountsanddisclos­

uresinthefinancialstatements.Anauditalsoincludesassessingtheaccountingprinciplesusedandsignificant

estimatesmadebytheBoardofDirectorsaswellasevaluatingtheoverallfinancialstatementspresentation.We

believethatourauditprovidesareasonablebasisforouropinion.

Inouropinion,theattachedfinancialstatementsgive,inconformitywiththeLuxembourglegalandregulatory

requirementsatrueandfairviewofthefinancialpositionofSociétéGénéraleBank&TrustS.A.atDecember31,

2005andtheresultsofitsoperationsfortheyearthenended.

Themanagementreportisconsistentwiththeannualfinancialstatements.

eRNST&YOuNG

SociétéAnonyme

IndependentAuditor

Jean-Michel PACAUD

Luxembourg, March 9, 2006

Report of the Independent Auditor

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST8�

Thecompleteabridgedversionoftheparentcompanyfinancialstatementsisavailableonrequest.

ASSETS 2005 2004

Cash, due from central banks and post office accounts 68,862,880 26,122,023

Loans and advances to credit institutions 9,854,354,775 7,980,801,928

Demand �21,20�,82� 2��,11�,�8�

Otherreceivables 9,233,1�8,9�8 �,�3�,�8�,2�1

Loans and advances to customers 9,972,792,131 5,952,997,514

Debt securities and other fixed-income securities 5,220,694,087 4,721,980,532

Treasurynotesandsimilarsecurities �,8�9,���,�9� �,��2,0�2,�0�

Bondsandotherdebtsecurities 3�1,239,�93 2�9,90�,92�

Shares and other variable-yield securities 1,055,895,859 330,403,034

Participating interests 55,069 55,437

Shares in affiliated undertakings 294,167,868 287,080,904

Intangible fixed assets 5,091,229 1,251,658

Tangible fixed assets 4,520,624 4,050,735

Other assets 49,698,450 31,227,390

Prepayments and accrued income 537,766,195 368,618,644

27,063,899,167 19,704,589,799

Balance sheet at December 31, 2005 (in EUR)

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST 8�

Thecompleteabridgedversionoftheparentcompanyfinancialstatementsisavailableonrequest.

lIABIlITIES ANd SHArEHoldErS’ EQuITy 2005 2004

Amounts owed to credit institutions 15,841,740,321 12,571,411,149

Demanddeposits 1,211,18�,3�3 ��8,02�,�8�

Termdepositsandsubjecttonotice 1�,�30,��2,9�8 12,003,38�,���

Amounts owed to customers 7,639,531,461 3,693,226,749

Otherdeposits:

Repayableondemand 3,003,808,��8 1,��8,0�2,�03

Withagreedmaturitydatesorperiodofnotice �,�3�,�22,913 2,12�,1��,1��

Debts evidenced by certificates 1,076,901,401 979,084,554

Bondborrowings 8�,���,31� ��,2�1,20�

Relatedpayables 992,13�,08� 90�,813,3�8

Other liabilities 88,026,774 162,065,551

Accruals and deferred income 497,484,651 430,426,665

Provisions for liabilities and charges 63,507,108 57,031,453

Provisionsforpensionsandsimilarobligations 8,2�2,12� �,81�,9��

Provisionsfortaxes �0,���,2�� 3�,980,390

Otherprovisions 1�,��8,�0� 1�,23�,10�

Subordinated debt 126,224,508 156,714,310

Special items with a reserve quota portion 17,254,770 17,254,770

Fund for general banking risks 2,250,601 2,250,601

Subscribed capital 1,179,042,732 1,179,042,732

Share premium 2,816,416 2,816,416

Reserves 101,373,375 72,956,631

Retained earnings 316,520,192 260,391,337

Net income for the year 111,224,857 119,916,881

27,063,899,167 19,704,589,799

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST8�

2005 2004

Contingent liabilities 330,430,345 206,686,305

Ofwhich:

[Acceptancesandcommitmentsonendorsementsofrediscountedbills] [1,019,0��] [�8,29�]

[Guaranteesandassetspledgedascollateral] [110,���,3��] [3�,�91,��2]

Commitments 1,540,508,757 198,096,377

Fiduciary operations 2,481,486,059 2,253,470,931

Off-balance sheet items at December 31, 2005 (in EUR)

Thecompleteabridgedversionoftheparentcompanyfinancialstatementsisavailableonrequest.

ANNuALRepORT2005■SOCIeTeGeNeRALeBANk&TRuST 8�

2005 2004

Interest and similar income 936,528,734 788,941,387Ofwhich:

[Fromfixed-incomesecurities] [1�0,188,�03] [13�,38�,983]

Interest and similar charges (797,776,759) (675,448,336)

Income from securities transactions 41,667,325 55,680,604Incomefromsharesandothervariable-yieldsecurities 39,983,98� ��,20�,��3Incomefromparticipatinginterests - 1�,��1Incomefromsharesinaffiliatedundertakings 1,�83,3�1 ���,�00

Fee income 147,059,731 112,183,944

Fee expense (74,550,231) (54,131,584)

Net income on financial transactions (32,160,453) (33,280,947)

Other operating income 4,940,412 6,134,810

General administrative expenses (80,553,154) (64,498,726)Personnelexpenses (��,��8,�0�) (��,�3�,8�8)Ofwhich:

[Employeecompensation] [3�,�0�,�12] [2�,12�,9��][Socialsecuritybenefitsandpayrolltaxes] [�,81�,22�] [�,���,�92]Ofwhich:

[Pension-relatedbenefitsandtaxes] [2,�90,�9�] [2,�02,08�]Otheradministrativeexpenses (22,90�,���) (1�,9�0,8�8)

Value adjustments in respect of tangible and intangible asset revaluations (2,440,260) (2,063,279)

Other operating charges (1,510,320) (1,018,972)

Value adjustments in respect of loans, advances and provisions for contingent liability and commitments (13,757,493) (2,900,000)

Value re-adjustments in respect of loans, advances and provisions for contingent liabilities and commitments 914,324 6,806,278

Exceptional losses (11,540) (1,840)

Tax on ordinary and exceptional income (17,125,459) (16,486,458)

Net income 111,224,857 119,916,881

Income statement at December 31, 2005 (in EUR)

Thecompleteabridgedversionoftheparentcompanyfinancialstatementsisavailableonrequest.

design and printing

ImprimerieCentrale

Paintings

CarolineDujardin

www.carolinedujardin.net

exhibitionSeptember15–October28,2005

inthepremisesofSociétéGénéraleBank&TrustLuxembourg

on the back cover

Atlas marocain

November 2003

Caroline Dujardin

on the cover page

La mare aux fées (Detail)

January 2001

Caroline Dujardin

on the right page

Rivages (Detail)

March 2005

Caroline Dujardin

Société Générale Bank & Trust

Société Générale Bank & Trust

11 avenue Emile ReuterL-2420 LuxembourgRCS Luxembourg B 6061Tel. +352 47 93 11-1Fax +352 22 88 59

sgbt.lu@socgen.comwww.sgbt.lu

annual Report

2005