ING's underlying net up 21 percent on loan, deposit growth
By Toby Sterling
AMSTERDAM (Reuters) - ING , the Netherlands' largest financial group, reported a 21 percent rise in second-quarter underlying banking profits on Wednesday as it won customers and benefited from what it said was a strengthening European recovery.
With cash accumulating and its solvency ratios well above industry averages, investors are asking whether ING might make acquisitions or return cash to shareholders.
The company's banking arm reported an underlying net result of 1.12 billion euros (852 million pounds), up 21 percent from 923 million a year earlier.
That was in line with the consensus of analysts polled by Reuters.
CEO Ralph Hamers said the numbers were "driven by robust loan and deposit growth and lower risk costs".
The bank said it won 600,000 new customers during the quarter, citing strength in France, Germany, Italy, Spain, Poland, Romania and Turkey.
"We don't see too many banks growing that fast," Hamers told reporters.
Group profit of 1.36 billion euros was up 25 percent from a year earlier, including a one-off negative effect from deconsolidating ING's former insurance arm NN Group and a windfall from revaluing its stake in India's ING Vysya Bank after a merger.
ING sold its stake in NN down to 37.6 percent during the quarter, completing the last major requirement of European Commission regulators to compensate for having received state aid in the form of a 2008 bailout.
ING declared an interim dividend of 0.24 euros per share for the first half of 2015, which will cost it 922 million euros, or 40 percent of its underlying profit.
"At the end of the year we will look and see whether it makes sense to pay more than 40 percent" as a final dividend, CFO Patrick Flynn told reporters.
"We do have capital at the holding company currently in excess of what we need at the bank."
But Flynn said ING would need to consider economic and regulatory factors at the end of the year before making a final decision.
ING is also considering acquisitions. "We have the capacity to look at markets, particularly the challenger growth markets," Flynn said.
In July, Reuters reported that ING was close to a $750 million deal to buy the Turkish operations of HSBC.
(Reporting by Toby Sterling; editing by Jason Neely)
