Credit: REUTERS/Francois LenoirAdds details
AMSTERDAM, Aug 6 (Reuters) - ING Groep NV INGA.AS, the largest Dutch financial group, on Thursday reported second-quarter pretax profit of 542 million euros ($644 million), as it took 1.34 billion euros in provisions for bad loans amid the coronavirus pandemic.
Analysts had forecast a pretax profit of 625 million euros, according to a Refinitiv poll.
In the second quarter of 2019, ING had reported pretax profit of 2 billion euros and loan provisions of 209 million euros.
“The Covid-19 pandemic continued in the second quarter to strongly impact the economies where we operate and how we conducted our own business,” said CEO Steven van Rijswijk, who took the job in July, replacing Ralph Hammers, who left to run UBSUBSG.S.
The higher provisions dominated the earnings, as interest income and fees and commissions were almost unchanged, though staff, regulatory and other expenses rose.
In addition, the company booked a one-off goodwill impairment of 310 million euros, which it had disclosed in July.
Although there were some provisions at ING's mortgage-heavy retail operations, its wholesale banking arm registered the most, at 833 million euros. That was enough to swing it to a loss of 302 million euros from a 553 million euro profit in 2019.
The provisions were "mainly attributable to some larger files (individual clients) in Germany, the Americas, Asia and the Netherlands, including a sizeable provision for a suspected external fraud case," ING said.
Other provisions reflected a worsening economy, the bank said.
($1 = 0.8420 euros)
(Reporting by Toby Sterling; Editing by Tom Hogue and Kim Coghill)
((toby.sterling@thomsonreuters.com; +31 20 504 5002;))
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