ABN AMRO Bank is set to announce its financial results for the second quarter on Wednesday. Here's what you need to know:
PROFIT FORECAST
Consensus estimates compiled by the group suggest that the Dutch lender will report a net profit of 547 million euros ($601.9 million) for the three months ending June 30. In the same period last year, the bank had posted a net profit of 475 million euros.
INCOME FORECAST
The bank's net interest income for the quarter is expected to reach 1.62 billion euros, according to consensus estimates. This would be an improvement from the 1.27 billion euros recorded in the same period last year.
UBS analysts note that the focus will be on changes in the underlying deposit mix and the bank's outlook going forward. They also anticipate stable net interest income for the quarter. RBC Capital Markets predicts that swap income and low deposit betas will drive the metric higher in the second quarter compared to the first quarter, despite low loan growth.
Consensus estimates peg the bank's total operating income for the quarter at 2.16 billion euros, up from 1.88 billion euros in the previous year.
WHAT TO WATCH
CET1 RATIO
Analysts expect ABN AMRO's common equity tier 1 capital ratio, a measure of a bank's resilience, to remain flat at 15.0% at the end of the quarter compared to the end of the first quarter.
DIVIDEND
Based on consensus figures, the bank's policy to return half of reported net profit to shareholders implies a dividend payout of 0.63 euros per share for the year.
SHARE BUYBACK
Analysts have mixed expectations regarding share buybacks, with forecasts ranging between 250 million euros and 500 million euros. The announcement of the buyback program is expected to be made either during this week's results or in the third quarter.
COSTS
Investors will be closely monitoring the bank's operating expenses, comparing them to the target of around 5.3 billion euros. Consensus estimates project operating expenses of 5.40 billion euros for 2023, including a contribution of 1.29 billion euros from the second quarter. UBS analysts also anticipate seasonally lower costs in the second quarter, partially supported by a small reversal of single resolution fund contributions.
