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ABN Amro ups NII target after profit beats expectations

By Reuters News

By Mateusz Rabiega and Jakob Van Calster

Nov 11 (Reuters) - Dutch lender ABN Amro ABNd.AS on Wednesday raised its annual commercial net interest income guidance by roughly 100 million euros to 6.9 billion euros ($7.7 billion), after exceptional gains helped third-quarter profit beat market expectations.

Higher interest rates continue to support margin income across the European banking sector, although investors remain focused on the impact on loan demand.

With around 70% of its third-quarter revenue derived from net interest income, ABN Amro offers a useful gauge of whether higher interest rates are beginning to weigh on lending activity despite supporting profitability.


  • Quarterly profit grew 52% to €940 million, exceeding the average forecast of €782 million by analysts polled by the bank, as the bank benefited from a one-off gain related to the acquisition of lender NIBC and a reversal in provisions

  • Its commercial net interest income (NII) rose 15% to €1.82 billion as the return of higher interest rates supported profitability

  • "The housing market continues to be supported by sound fundamentals, although higher interest rates are expected to temper activity", CEO Marguerite Bérard said in a statement

  • However, the bank expects the overall market to remain resilient, as income growth and limited housing supply help offset the impact of higher mortgage rates, CFO Ferdinand Vaandrager told journalists

  • Operational costs were broadly unchanged as lower staff costs helped offset inflationary pressures

  • The bank, which has long struggled with its operational efficiency, said its job cutting plan remained on track as the cost-to-income ratio was 53.2% in the quarter, below the 55% target by 2028

($1 = 0.8957 euros)

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