ING Shares Fall After 2023 Growth Guidance Misses Consensus -- Update

By Elena Vardon

Shares in ING Groep NV fell Thursday after the Dutch bank's updated 2023 guidance was below analyst expectations, despite posting a fourth-quarter earnings beat.

At 1132 GMT, shares were down EUR0.74, or 5.5%, at EUR12.66.

The lender expects total income growth for the year ahead to be more than 10%, which implies a figure of at least EUR20.42 billion. Analysts in a company-compiled consensus had this figure at EUR20.87 billion. For 2022, ING posted total income of EUR18.56 billion.

ING said it on track to meet its 2025 targets outlined in June, and updated its annual total income target to 4%-5% target, from 3% previously. It sees a cost-income ratio at 55%-56% for 2023, against the 50%-52% target and consensus's 54.1% estimate.

While the bank proposed a final dividend of EUR0.389 per share for the period in line with its distribution policy, some analysts pointed to disappointment at the lack of a clear share buyback trajectory. Jefferies expects ING to outline a share buyback at its first-quarter results in May.

Net profit for the last quarter of 2022 came in at 1.09 billion euros ($1.20 billion), compared with EUR945 million a year earlier and exceeding the EUR931 million expected by consensus.

Total income for the for the three months to Dec. 31 was EUR4.89 billion, beating consensus estimates of EUR4.64 billion. Net interest income--the difference between what banks earn on loans and pay clients for deposits--came in at EUR3.86 billion, against consensus of EUR3.79 billion, which excludes a EUR315 million charge related to the change in targeted longer-term refinancing operations (TLTRO) terms.

Operating expenses for the period fell to EUR2.89 billion from last year's EUR2.95 billion. This compares to the EUR2.83 billion expected by consensus.

The group said it managed to limit expense growth despite incurring higher costs from salary and marketing expenses.

ING's common equity Tier 1 ratio--a key measure of balance sheet strength--was 14.5% at the end of the period, from 14.7% a quarter earlier, and 14.4% consensus, it said.

Write to Elena Vardon at [e-mail]

(END) Dow Jones Newswires

February 02, 2023 07:02 ET (12:02 GMT)

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