AMSTERDAM (AP) — Dutch financial company ING Groep NV reported Wednesday that its first-quarter earnings rose as it sold businesses and improved profit margins at its banking arm. Its insurance arm reported a loss.
Net profit was €1.80 billion ($2.36 billion), compared with €728 million in the same period a year ago. This quarter’s figure includes €940 million in net gains on divestments, mostly from the sale of its life insurance business in Asia.
“Risk costs remained elevated amid the weak economic climate in Europe, but improved compared with the fourth quarter,” said Chief Executive Jan Hommen in a statement.
ING said it is hastening preparations for the separation of its banking and insurance arms, mandated by European regulators after the company received a €10 billion bailout from the Dutch state in 2008. It expects to spin off the insurance arm in 2014.
The company has been selling off assets and paying no dividends in order to repair its balance sheet and pay off the money it owes the state, which was given at a punishing 15 percent interest rate. ING said Wednesday it will repay €1.13 billion to the state by November 2013 out of the €3.38 billion remaining on its tab.
“ING showed strong performance across its banking activities and in particular commercial banking,” said SNS Securities analyst Lemer Salah in a note on the earnings, which he said were better than expected.