Net Profit Rises At ABN AMRO; Enters French Life Insurance Partnership Talks

Tom Burroughes

20 May 2024

Netherlands-headquartered group made a net profit of €674 million ($730 million) in the first three months of 2024, rising from €523 million a year earlier. Earnings per share rose to €0.76 per share from €0.56 per share, the lender said late last week.

Separately, on Friday, the bank – via its French private bank branch Neuflize OBC – has agreed to enter exclusive talks with BNP Paribas Cardif to form a strategic partnership in life insurance in France.

Such a pact would produce a distribution agreement and the sale of Neuflize Vie to BNP Paribas Cardif, the insurance subsidiary of the BNP Paribas Group, ABN AMRO said.

Neuflize Vie is the French insurance joint venture owned by ABN AMRO (60 per cent) and AXA (40 per cent). BNP Paribas Cardif intends to acquire all shares in Neuflize Vie for an undisclosed amount, the statement said.

The combination of BNP Paribas Cardif and Neuflize Vie would – if agreed – build a “high-end” life insurance business in France with assets under management of more than €25 billion.

In addition, BNP Paribas Cardif and Neuflize OBC intend to enter into a strategic partnership to ensure that Neuflize OBC's clients continue to have access to high-end insurance products, ABN AMRO said.

Results
In other details about its results, ABN AMRO said its cost/income ratio fell to 57.2 per cent in Q1 2024 to 65.6 per cent from a year earlier.

The Common Equity Tier 1 ratio – a standard international measure of a bank’s capital “shock absorber” – fell to 13.8 per cent at the end of March this year, from 15 per cent a year earlier.

In its comments, ABN AMRO said its net profit result was driven by net interest income, fee income and the low cost of risk.

The bank said fee income rose, helped by “good performance” in all client units.

“Costs came down 11 per cent in comparison with the first quarter of 2023 as regulatory levies were lower, while staff costs for data capabilities, digitalisation and regulation programmes remained high,” Robert Swaak, CEO, said. “We expect full-year costs for 2024 to be around €5.3 billion due to higher staff costs in the second half of the year.”