Nationalised Dutch bank ABN Amro posted a first-half loss of nearly €1 billion as charges for the integration of Fortis Bank Nederland and forced asset sales offset profitable underlying operations.
ABN Amro said in May it expected massive losses for the first half on those charges, and warned in June the losses would be even wider than it expected because of additional legal provisions Fortis had to take.
In total ABN posted a first-half net loss of €968 million. It recorded net integration charges of €481 million, a loss of €812 million on assets it sold to Deutsche Bank under an EU order, and additions to its legal provisions of €265 million.
Underlying profits rose 57 per cent to €325 million as net interest income rose, loan impairments fell by more than half and the bank enjoyed the same improvement in the margins it generates on savings accounts that competitors have reported.
The Dutch government nationalised the local operations of Fortis, including the two banks, in October 2008. Their legal merger was completed as of July 1st, though their operational integration is expected to run into 2012.
The government has spent more than €26 billion buying and supporting the banks, and chief executive Gerrit Zalm has said taxpayers are unlikely to get their money back.
Reuters