Mixed bag for ABN in profit surge
7 February 2005, AMSTERDAM — Reporting a 17.3 percent rise in net profit to EUR 3.7 billion last year, Dutch bank ABN Amro admitted on Monday that it had failed to achieve its target of securing a ranking among the top five banks in Europe.
7 February 2005
AMSTERDAM — Reporting a 17.3 percent rise in net profit to EUR 3.7 billion last year, Dutch bank ABN Amro admitted on Monday that it had failed to achieve its target of securing a ranking among the top five banks in Europe.
ABN chief Rijkman Groenink said the bank — which cut 2,850 jobs last year and sold about USD 4 billion in assets — had been too ambitious. But he said the bank will meet its target in its next four-year cycle.
Groenink, who has been in charge of ABN for four years, said the company had underestimated "the impact of restructuring programs on our businesses".
The company has nevertheless climbed from 11th at the end of last year to 6th in a list of 21 banks in Europe, measured on the value they offer to shareholders.
"While the near-term global economic outlook remains mixed, the strengthening of our capital base and business franchises over the past four years leaves us well positioned to create additional value for our shareholders," Groenink said.
ABN Amro's net profit was also above analyst expectations. The bank's aim to increase net profit in 2004 by at least 10 percent was met and if one-off gains were included, the bank could report a rise in net profit of 30 percent.
The bank said revenues grew in every division except for US mortgages. The positive results were attributed to cost-cutting and a large fall in bad debts. But the bank also suffered from weak economic growth in Europe, especially in the Netherlands.
Fourth quarter net profit rose by 10.6 percent to EUR 948 million compared with EUR 857 million in the same period in 2003. Taking into account one-off gains, net income rose 33 percent to EUR 1.14 billion.
[Copyright Expatica News 2005]
Subject: Dutch news