ING has made a billion euros in profit in the first three months of this year. That is an increase of fifty percent compared to a year ago. That was then the quarter in which the corona crisis started.
The bank says it can lend more money to the business community, partly thanks to the support of the European Central Bank. To support the European economy, banks can borrow cheaply from the ECB and lend it out again. “We are successfully converting the financing from the European Central Bank into loans to our customers, who have to deal with the consequences of the Covid-19 pandemic,” says ING CEO Steven van Rijswijk. “We thus contribute to the recovery.”
Low risk costs
In the past quarter, the bank says it has spent little on so-called risk costs, or in other words the slop for loans that cannot be repaid by customers. “As far as risk costs are concerned, we remain cautious and take into account the lag effects in credit losses,” said Van Rijswijk.
ING also says that it earns more from customers who invest through the bank. Savings now hardly yield any returns, which is why consumers are investing more often in their search for returns. Especially in Germany and Belgium, ING earned more from investment clients.
Because people are banking more and more online and to save costs, ING decided in March to close 69 branches in the Netherlands. As a result, more than 400 employees lose their jobs.