Dutch bank ABN Amro (TSXV: ABN) beat second-quarter net profit expectations with growth of 83% on Wednesday, but said it no longer expects to reach its 4.7 billion euro ($5.16 billion) 2024 cost saving target due to rising inflation and anti-money laundering (AML) measures.
“More effort than expected is required to ensure that our ongoing AML activities are at a sustainable and adequate level and meet regulatory requirements”, CEO Robert Swaak said in a statement.
Full-year costs for 2023 improved and are now expected around 5.2 billion euros, the group said, from 5.3 billion euros previously.
Largely state-owned ABN, one of three dominant banks in the Netherlands, has refocused its operations on the Dutch market in recent years, cutting thousands of jobs in the process.
The lender reported a net profit of 870 million euros for the three months to June, beating a company-compiled poll by analysts forecasting a net profit of 570 million euros, up from 475 million euros a year before.
Rival ING Groep, the largest Dutch bank, last week also reported a forecast-beating 83% jump in second-quarter net profit, as higher interest rates helped income from lending and fees grow, as well as low loan provisions.
ABN Amro’s CET1 ratio, a measure of capital strength for European banks, fell to 14.9% from 15.5% a year ago.
The interim dividend has been set at 0.62 euros per share, in line with the group’s policy.
