State-owned Dutch lender ABN Amro’s private banking arm has posted an underlying profit of EUR87m for the first quarter of 2015, up 70% compared to EUR52m a year earlier.
For the quarter ended 31 March 2015, the unit’s operating profit before tax surged 73% to EUR106m from EUR61m in the year ago quarter.
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The unit’s net fee and commission income jumped 19% to EUR159m from EUR134m a year ago. Net fees were mainly driven by higher client assets as a result of a favourable stock market performance and the acquired German activities.
The division’s operating expenses rose 10% to EUR244m from EUR223m in the first quarter of 2014.
Overall, the group’s underlying profit for the first quarter was EUR543m, up 44% from EUR378m in the prior year quarter.
ABN AMRO Group chairman of the managing board Gerrit Zalm said: ‘We had a good financial start to 2015, with a Q1 net profit of EUR 543 million, the highest level of profitability in the past 16 quarters. The underlying first-quarter net profit improved by 44% year-on-year and the RoE from 11% to 14% on the back of an increase in the operating result and lower impairments. Revenues increased by 9% compared with Q1 2014.
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By GlobalData"For the first time in two years we see the number of loan applications for small enterprises slowly increasing again whilst the level of acceptances has already been higher for the past three quarters. Operating expenses were up by 7% compared with Q1 2014 driven by higher pension charges, the investments we made to increase our agility and efficiency in the future and a reorganisation charge in Corporate Banking."
