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ING said that it is working on its loan provisioning as the provisions for bad loans dropped 51%. The slowdown in the economic activity also affected the bank’s total lending business.Earlier today, the largest Dutch banking giant ING Groep NV (NYSE: ING) announced its Q4 2020 results beating street estimates by a good margin. The banking giant announced 1.05 billion euro (.27 billion) in pre-tax profit by lowering loan loss provisions.The Refinitiv analysts had expected 649 million euros in revenue but ING delivered nearly 40% more. However, the profit was lower than .34 billion euros booked the previous year. In FY 2020, ING’s primary customer base jumped by 578,000 to 13.9 million. On the other hand, the total customer base reached 39.3 million.The COVID-19 pandemic and lockdowns
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ING said that it is working on its loan provisioning as the provisions for bad loans dropped 51%. The slowdown in the economic activity also affected the bank’s total lending business.
Earlier today, the largest Dutch banking giant ING Groep NV (NYSE: ING) announced its Q4 2020 results beating street estimates by a good margin. The banking giant announced 1.05 billion euro ($1.27 billion) in pre-tax profit by lowering loan loss provisions.
The Refinitiv analysts had expected 649 million euros in revenue but ING delivered nearly 40% more. However, the profit was lower than $1.34 billion euros booked the previous year. In FY 2020, ING’s primary customer base jumped by 578,000 to 13.9 million. On the other hand, the total customer base reached 39.3 million.
The COVID-19 pandemic and lockdowns also impacted the bank’s total lending business. This somewhat skewed the relationship between the net core lending and net customer deposits. The provisions for bad loans dropped 51% to 208 million from the same period a year ago.
ING CEO Steven van Rijswijk said that his company is taking sufficient provisions despite a negative tone from the European Central Bank. However, these provisions are still less as compared to its competitors. The CEO said:
“I’m proud of ING’s resilient results over 2020 and that more people continued to choose us as their primary bank, even as the year was defined by the unprecedented challenges of Covid-19 and its impact on our customers, business clients and society. This shows that our mobile- and digital-first capabilities, coupled with our strong network, are delivering value to customers and meeting their needs”.
The bank’s fees and commission income jumped 5% by 771 million euros. This was, however, offset with the net interest income dropping 7% to 3.34 billion euros. Rijswijk said that the economies will rebound from the crisis helping some stressed customers recover.
ING Strong Q4 Performance
Just as the European markets have opened, the stock of ING Groep NV is up 6.11% at press time. As of writing this story, ING stock is trading at $8.19 with a market cap of $32.02 billion.
In a further update, the ING CEO added that owing to lower economic activity and uncertain conditions last year, the demand for business and consumer loans declined. He also adds that the bank is seeing a healthy demand for mortgages. Also, more customers are choosing ING bank for investment products. The CEO also said that throughout the pandemic the bank continued to support its customers and employees.
“Throughout the pandemic, we’ve been talking to thousands of customers a week and have granted €19.4 billion in payment holidays. We’ve been making sure employees are supported technically, physically and mentally to work from home, and we continued providing community support by making donations and funding social projects,” he added.
Other updates from the business world can be found here.
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.