ING ING Groep NV

By Maarten van Tartwijk 

AMSTERDAM-- ING Groep NV said Wednesday that its second-quarter net profit soared as the Dutch bank expanded its loan book and kept margins stable despite pressure from record low interest rates.

The Amsterdam-based bank, the Netherlands' largest lender by assets, said net profit was EUR1.3 billion ($1.46 billion) in the three months to the end of June, up from EUR358 million in the same period a year earlier. Underlying net profit, which excludes asset disposals, rose 27% to EUR1.4 billion, beating market expectations.

The bank's shares opened 4% higher following the results.

ING said its latest results were lifted by the strong growth of its loan book, which expanded by EUR14.8 billion in the quarter, as well as an improved performance at its financial-markets division and a drop in loan-loss provisions.

The bank' underlying interest margin, the difference between the rate at which it borrows and lends, remained relatively stable despite ultralow interest rates. It was 1.50% compared with 1.43% last year and 1.51% in the previous quarter.

European bank shares have been hit hard in recent months in part because of concerns that historically low interest rates and more stringent regulations will eat into their profitability. ING's shares have fallen more than 20% since the start of 2016 and by around 40% in the past year.

ING, one of Europe's largest savings banks with EUR452 billion in retail client deposits, has been able to protect profitability by slashing rates on savings accounts. The bank said it reduced rates in a host of countries, including the Netherlands, Italy and Germany, although savings margins fell.

Overall, net interest income was EUR3.3 billion, representing a 5.3% increase from last year and a 0.6% rise from the previous quarter.

ING's results were further boosted by a EUR200 million gain on the sale of its stake in Visa Europe, offsetting a EUR137 million provision linked to an interest-rate derivatives miss-selling scandal in the Netherlands.

The bank said it would declare an interim dividend of EUR0.24 a share, unchanged from the previous year.

Write to Maarten van Tartwijk at maarten.vantartwijk@wsj.com

(END) Dow Jones Newswires

August 03, 2016 03:24 ET (07:24 GMT)

ING Groep NV (NYSE:ING)
Historical Stock Chart
From Mar 2024 to Apr 2024

ING Groep NV (NYSE:ING)
Historical Stock Chart
From Apr 2023 to Apr 2024