By Elena Vardon
ING Groep, the Dutch bank, is set to announce its second-quarter results for 2023 on Thursday. Here are the key details:
Net Profit Forecast
According to a consensus compiled by the company based on estimates from 18 analysts, ING Groep is expected to report a net profit of 1.64 million euros ($2.10 billion) for the second quarter. This is an increase from the net profit of EUR1.18 billion recorded in the same period last year. Analysts from Jefferies note that lower costs are likely to offset higher provisions and flat revenues.
Net Interest Income Forecast
The consensus estimate for ING Groep’s net interest income for the second quarter is EUR4.13 billion, compared to EUR3.465 billion in the same quarter a year ago. In a note, Morgan Stanley analyst Giulia Aurora Miotto explains that this growth is due to rate hikes flowing through and highlights that “the bank had a relatively higher pass through of savings in 2Q when compared to 1Q, with the savings rate increasing steadily in the Netherlands.”
What to Watch
Here are the key aspects to watch out for in ING Groep’s second-quarter results:
The common equity Tier 1 ratio, which is an important measure of balance-sheet strength, will be closely observed. The consensus estimate expects the ratio to be 14.6%, slightly lower than the 14.8% recorded at the end of the first quarter.
Consensus estimates suggest a dividend of EUR0.31 per share for the second quarter, bringing the full-year payout to EUR0.92. While no share buyback program is expected to be announced at this stage, analysts anticipate one to be introduced during the third-quarter results, once the current program concludes on Oct. 18.
Bank of America Global Research’s analyst Tarik El Mejjad predicts that ING Groep will upgrade its guidance for the year. The current projections of 10% revenue growth for the year are deemed too conservative.