Tough first quarter for ING as net profit shrinks by almost 50%

Net profit earned by financial services group ING went down by almost half to €680m in the first three months of this year, the bank said on Wednesday.

‘The operating environment remained challenging in the first quarter, as the European sovereign debt crisis persisted, increasing volatility on financial markets,’ chief executive Jan Hommen said in a statement.
The Financieele Dagblad said Q1 earnings were hit by the decision to set aside several hundred million euros to cover a hoped-for out-of-court settlement with the US authorities relating to transactions carried out by ING Commercial Banking in 2007.
ING also said it is in talks with the Dutch government and will soon begin negotiations with Brussels about the requirement that ING sell its insurance activities.
Earlier this year, the European Court of Justice said the European Commission was wrong in imposing extra conditions on the bank when it repaid some of the €10bn loan early.
Nevertheless, Hommen said the bank ‘remains committed to the decision to separate the banking and insurance operations, and is making good progress in preparing our insurance and investment management businesses for stand-alone futures in Europe and the US.’
ING does not yet know when it will repay the remaining €3bn it owes the government out of the total €10bn bail-out it received during the financial crisis.

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