Societe Generale reports profits plunge

FRENCH bank Societe Generale reported on Wednesday that net profit in 2012 plunged by two thirds owing to exceptional charges but said it had met all its strategic targets.

The bank reported a net profit last year of 774 million euros ($A1.02 billion), a fall of 67.5 per cent from the figure in 2011.

The price of shares in the bank was showing a fall of 3.67 per cent in early afternoon trading. The overall market as measured by the CAC 40 index was showing a gain of 0.20 per cent.

The results had been hit by exceptional charges of 2.6 billion euros, the bank said in a statement.

But the results, excluding these charges, showed a profit of 3.4 billion euros, similar to the figure of 3.5 billion euros in 2011.

The bank said that it had achieved its strategic targets including the sale of its Greek unit Geniki and US investment business TCW.

It would now put in place the second stage of its strategic plan to 2015, focusing on three activities, including retail banking in France.

This should underpin the potential for growth and profitability, it said.

The board proposed to pay a dividend of 0.45 euros per share. Last year it did not pay a dividend for the first time since it was privatised in 1987, in an effort to strengthen shareholders' funds.

The bank stood by its target to achieve a ratio of core capital to loans made of 9.0-9.5 per cent, under rules laid down by the so-called Basel III standard which takes full effect at the end of 2018.

In the fourth quarter, the bank made a net loss of 476 million euros, which was more than twice the figure expected by analysts polled by Dow Jones Newswires. They had expected a loss of about 206 million euros.

The statement said that the bank had made a provision of 300 million euros in the last quarter of the year in respect of unspecified litigation.

Net banking income, a key measure of the margin between taking money in and lending it out, fell by 9.9 per cent to 23.1 billion euros.

AFP

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Benedict will lose power of infallibility

POPE Benedict XVI will lose his infallibility - his supreme authority in Church matters - as soon he steps down on February 28, the Vatican says as it struggles to explain a virtually unprecedented situation.

"These powers go with the office, so they will pass to the next pope.... Whoever renounces no longer has the assistance of the Holy Spirit to guide the Universal Church," Vatican spokesman Federico Lombardi said at a briefing.

The issue is complex for many Catholics who believe the election of a pope is divinely inspired and are accustomed to popes remaining in office until death.

Benedict will be the first pope to resign in more than 700 years and only the second to do so voluntarily in the Catholic Church's 2000-year history.

Though papal infallibility was only set in stone in 1870, the idea had long been part of Church history and debate, and the notion of the Bishop of Rome as a preserver of apostolic truth was first mooted in the sixth century.

The special power has been used only once by a pope - in 1950 when Pius XII established the Assumption of Mary as Church dogma - and is limited to "ex cathedra" statements of doctrine or faith that apply to the whole Church.

While Benedict will have to drop his claim to being right all the time, the Vatican said that as ex-pope he will enjoy a pension of sorts when he retires as planned to a monastery with flower beds and a vegetable garden inside the Vatican walls.

"We will ensure he can live a dignified existence," Lombardi said.

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US stocks open higher after Obama speech

US stocks have headed higher in opening trade after President Barack Obama laid out economic stimulus plans in his State of the Union address to Congress.

Five minutes into trade, the Dow Jones Industrial Average was up 2.91 points (0.02 per cent) at 14,021.61.

The S&P 500, a broad measure of the markets, rose 3.63 points (0.24 per cent) to 1523.06.

Both indexes were extending five-year highs reached on Tuesday.

The tech-rich Nasdaq Composite climbed 10.06 points (0.32 per cent) to 3196.55.

The positive sentiment on the market followed Tuesday's State of the Union address by Obama, Wells Fargo Advisors said in a market note.

"President Obama's annual agenda included a minimum-wage hike, a boost in infrastructure spending and calls for reducing the budget deficit through tax increases and spending cuts," it said.

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Zimbabwe sets March referendum, July poll

ZIMBABWE'S prime minister has announced the country will hold a constitutional referendum in March followed by elections in July, a timetable that will decide the fate of veteran President Robert Mugabe.

"There will be a referendum in March," said Morgan Tsvangirai, Mugabe's rival in the power sharing government.

Douglas Mwonzora, a spokesman for Tsvangirai's Movement for Democratic Change, told AFP the referendum will be held on March 16.

Zimbabweans will be asked to vote on a basic law that would, for the first time, set presidential term limits and abolish the head of state's immunity.

It would also set the stage for a presidential and legislative election that will be held in July, according to Tsvangirai.

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France's Total reports strong profits

FRENCH oil giant Total has reported an 8.0 per cent rise in net profit to 12.4 billion euros ($A16.30 billion) in 2012, excluding the change in value of oil in stock.

This is the measure, known as the current-cost accounting basis, which is most closely watched in the oil sector.

Net profit on an overall basis, the historic-cost method, fell by 13.0 per cent to 10.7 billion euros.

The statement said that a fall in production had been counter-balanced by high oil prices and a temporary rally of margins for refiners in Europe.

The results were in line with forecasts by analysts who had expected a net profit on a current-cost accounting basis of 12.4 billion euros.

Oil prices were high last year owing largely to tension over supplies from Iran which is the target of economic sanctions against its nuclear program.

These high prices offset a drop in Total's overall hydrocarbon output which fell 2.0 per cent in 2012 to 2.3 million barrels per day in oil equivalent.

The company said it was targeting a two to three per cent boost in output for 2013, which chief executive Christophe de Margerie said would require a special effort.

The group said it was well advanced in an asset divestment program set to unload between $US15 billion ($A14.63 billion) and $US20 billion by 2014.

Total expects to shed assets worth $9.0 billion in 2013, after ceding about $6.0 billion in 2012.

Total is Western Europe's third biggest oil producer, behind Shell and BP, and France's biggest company by market capitalisation, just ahead of former subsidiary Sanofi, the drugmaker.

Total's shares were up by 0.20 per cent in afternoon trading on Wednesday, slightly lower than a Paris market rising by 0.36 per cent.

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Five WA towns under bushfire threat

A BUSHFIRE that has destroyed two homes in Western Australia's southwest is threatening five towns in the Donnybrook and Bridgetown areas.

A string of bushfires sparked by lightning strikes on Tuesday have swept through the region.

The Department of Fire and Emergency Services (DFES) said homes in Greenbushes, Hester Brook, Wandillup, Maranup and Southampton are under direct threat by fire and has warned residents to act immediately.

An emergency warning has been issued for these towns.

Bridgetown and Balingup residents have been placed on a watch and act alert, meaning they should leave or get ready to actively defend their properties as the bushfire approaches.

The bushfire started west of the Blackwood River in Southampton and crossed the river, moving in a north easterly direction.

A homestead in Southampton, 12km south of Balingup and built in 1862, has burnt down.

A home some 900 metres away has also been destroyed.

More than 200 firefighters are working to contain the fire, assisted by six water bombers and two helicopters.

About 3000 hectares have been burnt so far.

Greenbushes and Balingup primary schools will be closed on Thursday because of the fire.

A bushfire advice has also been issued for people in the Blackwood Valley between Balingup and Nannup.

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Qld sex offender's release to be appealed

AFTER spending almost half his life in jail, one of Queensland's most notorious sex offenders will have to wait a little longer to see if he will be released.

Attorney-General Jarrod Bleijie will lodge an appeal on Thursday morning against a Supreme Court decision to set Robert John Fardon free.

Justice Debbie Mullins decided Fardon should be released as any risks to the community could be managed.

She imposed 34 conditions for his release.

Her reasoning did not convince Mr Bleijie, who will apply for an immediate stay of the order to release the 64-year-old serial rapist.

Mr Bleijie has also instructed Crown Law to appeal the Supreme Court decision to release Fardon from jail.

Child protection advocates, and former victims have denounced the decision by Brisbane Supreme Court Judge Debbie Mullins to release Fardon on Thursday afternoon.

Bravehearts founder Hetty Johnson says Justice Mullins' decision trashes the notion of community safety.

"Fardon is not a changed man; he's a psychopath.

"He's only ever going to be one breath away from snapping ... and will be back in jail in 12 months."

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First German horsemeat case suspected

GERMANY has been dragged into the horsemeat scandal in Europe, announcing its first suspected case of horsemeat being mislabelled as beef.

The product was delivered to at least one trader in the western state of North Rhine-Westphalia.

Documents had indicated that products had been delivered via a distributor in Luxembourg suspected of mislabelling horsemeat.

As a precautionary measure, the German supermarket chain Kaiser's Tengelmann has taken its home brand frozen lasagne off the shelves.

European Union farm ministers will hold crisis talks in Brussels, after France became the second EU nation after Britain to find horsemeat being passed off as beef in frozen foods.

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