ABN Amro rides high rates with first-quarter net profit beat

DUTCH bank ABN Amro beat first-quarter profit expectations on Wednesday (May 15), saying it continued to benefit from a high interest rate environment with strong net interest income and a low cost of risk.

ABN Amro, one of three dominant banks in the Netherlands along with ING and Rabobank, posted a 29 per cent rise in quarterly net profit to 674 million euros (S$985 million), compared to a year earlier.

That beat an average forecast of 521 million euros in a poll of analysts compiled by the bank.

“Demand for credit remains good and both our mortgage and corporate loan books grew,” CEO Robert Swaak said.

Banks have been among the main beneficiaries of rising interest rates over the last three years. However, the European Central Bank is expected to soften its monetary policy in June, raising concerns about their profits.

ABN Amro’s net interest income (NII), a key measure of earnings on loans minus deposit costs, fell 2 per cent to 1.59 billion euros in the first quarter, compared to a year earlier, but was above analysts estimates of 1.56 billion euros.

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The bank said it expects NII of around 6.3 billion euros this year, the same as in 2023, and costs of around 5.3 billion euros due to higher staff expenses. REUTERS