The private banking arm of Dutch lender ABN AMRO has posted an underlying profit of €49m for the fourth quarter of 2016, a surge of 84% compared to €26m in the previous year.

ABN AMRO said that the increase in underlying profit was mainly due to higher operating income.

For the quarter ended 31 December 2016, the division’s operating profit before tax was €54m, a surge of 65% from €33m in the corresponding quarter of 2015.

Operating income rose by 6% to €338m from €318m in the prior year, while net interest income increased 13% year-on-year to €169m.

The unit’s operating expenses decreased by 1% to €277m from €279m the year ago.

The underlying cost/income ratio of the private banking division was 82.1%, a rise of 5.8 percentage points compared with 87.9% in the previous year.

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By GlobalData

As of 31 December 2016, client assets stood at €204.9bn, while net new assets were €0.2bn.

Overall, the banking group posted underlying profit of €333m for the fourth quarter of 2016, a surge of 23% from €272m in the fourth quarter of 2015.

ABN AMRO Group CEO Kees van Dijkhuizen said: “The fourth-quarter results are solid. The underlying net profit was EUR 333 million for the fourth quarter and EUR 2,076 million for the full year, an increase of 8% compared with 2015.

“This past quarter we achieved loan growth in all of our major loan books: we were the number one provider of new mortgages in the Netherlands for the second consecutive year, the SME loan portfolio in the Netherlands grew modestly again after years of decline, and we onboarded new corporate clients internationally.

“As the cost/income ratio is still too high, we announced a restructuring plan in the second half of 2016. The ROE was 11.8% and the capital position strengthened further. We have increased the proposed dividend for full-year 2016 to EUR 0.84 per share. This is a payout ratio of 45% of the reported net profit.”