ABN Amro Profit Hit by Compliance Cost as Dividend Disappoints

(Bloomberg) -- ABN Amro Group NV missed fourth quarter profit estimates on increased anti-money laundering costs and an anticipated dividend increase failed to materialize.

The Dutch lender kept its dividend at 1.45 euros for 2018, the same as the year before, missing analyst estimates of 1.54 euros. Fourth quarter net income was 316 million euros, this result includes 85 million euros in pre-tax for additional costs of customer due diligence programs and elevated loan impairments.

Key Insights

• The CET 1 ratio declined to 18.4 percent from 18.6 percent in the previous quarter, maintaining one of the highest capital buffers in Europe.
• Net interest income fell to 1.64 billion euros from 1.7 billion euros a year earlier, as ABN Amro faced increased competitions from new players -- mostly pension funds and insures -- in the Dutch mortgage market.
• Cost-to-income ratio deteriorated to 70.2 percent from 68 percent a year earlier, as the bank is tries to trim costs. In August, the lender announced a restructuring at its investment bank as the division’s profitability lags behind its retail arm.

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• Link to statement

To contact the reporter on this story: Ruben Munsterman in Amsterdam at rmunsterman1@bloomberg.net

To contact the editors responsible for this story: Dale Crofts at dcrofts@bloomberg.net, Ross Larsen

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