AMSTERDAM, May 6 (Reuters) – ING on Friday reported first-quarter profit below expectations, due to an increase in provisions for bad debts linked to exposures to Russia.
The largest Dutch bank reported first-quarter net profit of 429 million euros, down from 1.01 billion a year ago and below analysts’ forecasts of 679 million euros, according to data from Refinitiv.
The net addition to bad debt provisions was 987 million euros this quarter, the company said in a statement.
“The geopolitical situation, with Russia’s invasion of Ukraine, had a significant impact on risk costs during this quarter, with 834 million risk costs associated with our exposure to Russia,” he said. said the group.
ING said in March that it had around €700 million in loans impacted by the sanctions against Russian entities and personalities.
The bank had also declared 5.3 billion euros in loans to Russian borrowers, or about 0.9% of its entire loan portfolio.
Ella said on Friday it had set aside a total of 2.5 billion euros in capital to cover expected and unexpected losses on its exposure to Russia.
“This amount includes the 0.8 billion euros in provisions for loan losses mentioned and 1.7 billion euros (of capital set aside) out of 13.3 billion euros in risk-weighted assets. credit exposure on Russia-related exposure,” ING said.
Apart from the impact of Russia, its quarterly results remained unsurprising, with income down 2.2% to 4.6 billion euros, due in particular to the drop in funds from the long-term loan program. term from the European Central Bank, under which ING borrows at a negative rate.
ING’s loan portfolio grew slightly, with retail loans increasing by €5.6 billion, mainly for mortgages in Germany, Australia and Spain. Loans to wholesalers, on the other hand, fell by 5.2 billion euros.
Fees and commissions increased by 9.3% to 933 million euros.
The ING title closed at 9.14 euros on Thursday, down 25% since the start of the year. (Reporting Toby Sterling; French version Dagmarah Mackos; Editing by Kate Entringer)
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