ING’s profit plummets due to credit losses Financial

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Compared to the first quarter of this year, ING had to put in the sling pot twice as much. The bank does think that this amount will be considerably less for the rest of the year.

At the bottom of the line, net profit for ING in the second quarter remained at € 299 million. That is a decrease of 79.2% compared to the same period a year ago.

In addition to the additional reserves for credit losses, ING also booked € 310 million in so-called goodwill off. The value of some past acquisitions declined due to the corona crisis. This was written off under operating expenses, which increased by as much as 14% in the second quarter.

In the second quarter, customers put an extra € 20.9 billion on their savings bank books. Although consumers normally receive their holiday pay during this period, according to ING, the growth in savings mainly reflects that people started to spend less during the corona months.

The bank came with more bad news for ING shareholders on Thursday. ING announced that it would grant the request of the European Central Bank (ECB) to European banks not to pay a dividend until at least January 1, 2021. The ECB had previously requested that the profit distribution be suspended until the end of July. Insurers such as NN and ASR are resuming their dividend payment.

Fraud case

ING’s investment bank fell into the red in the second quarter. Here ING written off € 260 million in goodwill. In addition, the investment bank accounted for two-thirds of the reserves for credit losses with € 882 million.

The division faces ‘some major issues’ in Germany, America, Asia and the Netherlands. ING reportedly entered the ship for € 180 million due to the fraud and the bankruptcy of Wirecard. In concrete terms, however, ING does not mention the German payment service provider in the quarterly report, but does speak of a ‘substantial provision for a suspected external fraud case’.

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