ING misses estimates as lending income declines, costs rise
Jerry
ING Groep NV missed analysts’ estimates for profit in the fourth quarter as the lender saw lower policy rates weigh on its lending income while inflation pushed up staff expenses.
The Netherlands’ biggest bank reported net income of €1.15 billion ($1.2 billion) for the three months through December, compared with analysts’ estimate of €1.29 billion. Net interest income, or the difference between what it earns on loans and pays for deposits, fell 5%. Operating expenses rose 8.5%.
The results are “ok to slightly soft,” analysts at Deutsche Bank AG said in a note, pointing to the impact of higher costs. Shares of the lender fell 3.4% at 9:04 a.m. in Amsterdam, the worst performer in an index of European banks. The decline pared gains this year to 2%.
Chief Executive Officer Steven van Rijswijk has sought to diversify ING as European banks begin to grapple with a lower rate environment. Last year, ING announced a target of growing total income by 4% to 5% a year on average through 2027, by boosting fee income, increasing the capital allocated to its retail business and improving capital efficiency in wholesale banking.
Source: FORTUNE
