AMSTERDAM (Reuters) – Dutch bank ABN Amro said on Wednesday it will buy 500 million euros ($571 million) of its own shares, as it reported higher-than-expected net profit of 552 million euros for the fourth quarter, helped by economic recovery and the sale of its head office.
“ABN Amro intends to provide an attractive return to shareholders and this buyback is an important milestone”, Chief Executive Robert Swaak said.
Largely state-owned ABN Amro said its core capital adequacy ratio remained very strong at 16.3% at the end of December, including the effects of the share buyback set to be completed by June.
The easing of COVID-19 lockdown measures in the Netherlands improved the financial health of ABN Amro’s clients in the last months of last year, while interest income fell less than expected.
Persistently low interest rates drove net interest income down 1% from a year before in the fourth quarter, taking the drop for the whole year to 11%.
Profit in the final months of 2021 was also helped significantly by a 245 million euros net gain on the sale and leaseback of ABN’s head quarters in the south of Amsterdam.
Analysts in a company-compiled poll had predicted average net profit of 451 million euros for the last three months of 2021, up from 54 million a year ago.
ABN Amro was re-privatized in 2015, but the Dutch state still owns 56% of the shares and hasn’t sold any since September 2017.
($1=0.8755 euros)