Profit growth for ING bank thanks to rising interest rates

This article was last updated on August 3, 2023

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ING bank can look back on a strong second quarter

Quarterly profit almost doubles

ING bank can look back on a strong second quarter and, thanks to rising interest rates, earned a lot from lending and mortgages. Customers have banked more, more customers have been added, more loans have been extended, despite high inflation, the weakening economy, and a great deal of geopolitical uncertainty. The quarterly profit of almost 2.2 billion euros is almost twice as much as a year ago when the bank was able to add 1.2 billion euros as profit.

Higher interest rates benefit ING bank

Last year, the European Central Bank (ECB) raised its key policy rate by more than 4 percent. This higher interest rate is reflected in higher credit and mortgage interest rates. Thanks to the rise in interest rates, ING is once again earning more from lending mortgages and loans.

Savings interest rates lagging behind

Savings interest rates are lagging behind for the time being, they are not rising nearly as fast as the interest rates of the central banks. ING currently gives 1.25 percent interest on savings, and that was 0.01 percent six months ago. Despite the meager interest on savings, ING still attracted more savings.

Bank infirmary

Low risk costs for ING bank

ING also has low risk costs, which indicates that they are not affected by customers who do not pay off their loans or are in financial trouble. Money has been set aside for only 6 percent of the entire credit and loan portfolio. The straw pot has been increased by 98 million euros, a relatively low amount. Things are quiet for the time being at the Special Management department, the bank’s infirmary for companies and consumers in financial problems.

No change in loan approvals

The bank has not become more difficult about loans. Although the loan book has grown, demand for credit is declining, especially for mortgages.

Largest bank in the Netherlands

ING is the largest bank in the Netherlands and one of the largest in Europe. The bank is mainly active in the Netherlands, Belgium, Germany, Austria, Italy, and Spain. It employs 59,000 people worldwide. The bank’s balance sheet contains EUR 640 billion in loans and credits and EUR 680 billion in customer bank balances.