By Leo Marchandon and Matteo Allevi
(Reuters) – Dutch bank ABN Amro on Wednesday raised its full-year net interest income forecast to 6.4 billion euros ($6.98 billion) after beating second-quarter estimates, sending its shares up 3 percent.
ABN Amro’s previous forecast of €6.3 billion was in line with 2023 levels.
Dutch bank ING also raised its 2024 forecast for total income to more than 22 billion euros after reporting second-quarter net interest income above estimates last week.
ABN Amro beat second-quarter earnings expectations, benefiting from a “higher for longer” interest rate environment, lagging some of the euro zone’s biggest banks.
“Our results continue to benefit from the good performance of the Dutch economy,” Chief Executive Robert Swaak said in a statement, pointing to a recovery in the housing market amid an increase in the number of new mortgage customers.
The bank’s net interest income, a key measure of earnings on loans minus deposit costs, fell 1% in the second quarter to 1.61 billion euros year-on-year, but beat analysts’ expectations of 1.58 billion euros in a company poll.
Net profit also beat estimates at €642 million, but was down 26% year-on-year.
The company’s CET1 ratio, a measure of capital strength for European banks that compares their core capital to risk-weighted assets, fell to 13.8% from a year ago, in line with analysts’ estimates.
Earlier this month, ABN Amro reached a new two-year collective labour agreement that includes a pay rise, raising staff expenses to €659 million from €612 million a year earlier.
However, the bank maintained its cost guidance for the year at around €5.3 billion.
The company said it would distribute an interim dividend of 60 euro cents per share on September 11.
The company announced last week that CEO Robert Swak would step down in 2025, without announcing a candidate to replace him.
(1 dollar = 0.9168 euro)