ABN plans to pay 50% of its net profits to shareholders. Credit: Gerd Altmann from Pixabay.

The private banking unit of ABN Amro has reported a profit of €52m for the second quarter of 2021 as against  €19m in the year-ago quarter.

Net interest income declined 5% to €159m from €167m last year mainly due to continued pressure on deposit margins.

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Net fee and commission income increased 22% to €145m from €119m in the second quarter of 2020.

For the quarter ended 30 June 2021, net new assets showed an outflow of €2.9bn, of which €2.3bn related to the termination of a fiduciary assets contract.

Group-wide Performance:  

Overall, ABN Amro group posted a net profit of €393m for the second quarter of 2021 compared to a net loss of €5m a year earlier, after booking a net impairment release.

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The Dutch banking group said it released €79m of impairments made during the Covid-19 crisis, chiefly due the improved macroeconomic outlook.

Net interest income declined 14% to €1.3bn from €1.5bn in the second quarter of 2020.

Operating income during the second quarter stood at €1.7bn, which represents a decline of 13% compared to €1.98bn last year.

The lender closed the second quarter with a fully loaded CET1 ratio–a measure of a bank’s financial strength–of 18.3%.

ABN noted that given its strong capital position it will pay suspended 2019 dividends of €0.68 per share in October 2021.

It also announced plans to payout 50% of its net profits to shareholders in the time to come.

Comment:

ABN Amro CEO Robert Swaak said: “As a result of the improved macroeconomic outlook we again saw a release of impairments in the second quarter. Demand for corporate loans in the Netherlands is still muted as strong government support continues, but it is showing signs of stabilising and the pipeline is improving.

“We are making progress in executing our strategy to be a personal bank in the digital age serving clients where we have scale in the Netherlands and Northwest Europe. We are well ahead of plan in the wind-down of the CIB non-core portfolio which has been reduced by over 80% since Q2 2020, supported by loan disposals.”