ABN Amro booked underlying net profit of €1.9bn last year, a rise of 24% on 2014, the state-owned bank said on Wednesday.

The bank said it benefited from the economic recovery and setting aside less money to cover potential bad debts. ‘2015 was a good year for the bank,’ chief executive Gerrit Zalm said in a statement.

The bank, which was nationalised in 2008, is still largely in Dutch government hands. The flotation of around 20% of the shares generated €3.3bn for the treasury in November. The remaining shares will be sold off at later dates.

Challenges

Looking ahead, the bank will ‘continue to focus on adapting to challenging market developments, such as the continued low interest rate environment, increasing competition in the mortgage market, and regulatory and economic uncertainty,’ Zalm said.

The big three banks – ABN Amro, ING and Rabobank – are being pressured by new mortgage providers and now control less than 50% of the Dutch mortgage market.

Despite the full year profit rise, in the fourth quarter net profit fell 32%. This was due to a €190m charge for regulatory levies as well as project costs, pension expenses and ‘provisions for an identified group of SMEs with possible derivative-related issues and legal claims’, ABN Amro said.