(Reuters) – ING reported first-quarter earnings that beat expectations on Thursday, pushing the stock of the Netherlands’ largest bank higher as interest rates rose, combined with a contained cost of risk, which had a positive impact on margins. It also announced the launch of a share buyback program for a maximum total amount of 1.5 billion euros.
ING stock was up around 3% at 9:30 a.m. CET.
Lenders’ margins are benefiting from higher interest rates after major central banks raised policy rates at the fastest rate in at least two decades in 2022 to fight inflation.” marked by turbulent market conditions, our customers continued to place their trust in us, as evidenced by our stable and diversified deposit base, which grew by €1.3 billion during the quarter,” ING said.
The company’s CET1 ratio, a solvency measure for European banks, rose 0.3 percentage points from the previous quarter to 14.8%, above the current requirement of 10.73%. .
The bank’s net additions to loan loss provisions, or money set aside for defaulting loans, totaled 152 million euros in the quarter, which the group says is “well below the average of the cycle”. The group, which serves around 37 million customers, businesses and financial institutions in more than 40 countries, said its net profit jumped to 1.59 billion euros in the first three months of 2023, exceeding the 1.11 billion euros expected by analysts polled by the company. ING had recorded a profit of 429 million euros over the same period last year, penalized by charges of 834 million euros related to its exposure to Russia.
(Report Diana Mandiá in Gdansk; Nathan Vifflin, edited by Tangi Salaün)
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