ING shares fall as bank plans job cuts

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ING shares fall

Highlights

ING shares fell 3.77% to $31.65.
Quarterly profit missed expectations.
ING plans to cut 400 additional jobs.

Bloomberg reported that ING plans to eliminate approximately 400 positions as part of a restructuring of its wholesale banking division. The overhaul is expected to generate annual cost savings of about €75 million as the bank seeks to improve efficiency.

Higher costs and provisions weigh on earnings

Net income at the Netherlands' largest bank rose 3.5% to €1.85 billion ($2.06 billion) in the three months ended September, below the €2.01 billion expected by analysts.

Quarterly revenue increased to €6.23 billion from €5.90 billion a year earlier, although it missed the €6.33 billion consensus forecast. Net interest income reached €4.26 billion, compared with €3.71 billion last year, supported by higher European interest rates.

Operating expenses climbed 3.6% to €3.12 billion, exceeding the €3.08 billion estimate. ING attributed the increase partly to personnel costs and the expansion of its retail operations.

Credit provisions rose to €403 million, above expectations of approximately €350 million. The total included a €111 million adjustment related to anticipated changes in project-finance accounting models rather than a deterioration in underlying loan quality.

Wholesale banking restructuring targets lower costs

ING will rename its wholesale banking division Corporate and Institutional Banking as part of an overhaul scheduled to take effect in March.

The restructuring will eliminate around 400 positions, adding to an existing efficiency program expected to reduce the global workforce by approximately 1,250 employees. The bank anticipates a fourth-quarter restructuring provision of about €175 million and annual cost savings of approximately €75 million.

ING has also been expanding selected businesses, including wealth management. During the quarter, it agreed to acquire a minority stake in Spanish private lender Singular Bank from Warburg Pincus.

Investors weigh earnings pressure against capital returns

The earnings miss and additional restructuring costs put pressure on ING shares, despite the bank maintaining its longer-term revenue outlook. Management still expects annual revenue above €24.5 billion in 2026 and more than €26 billion in 2027.

ING also announced a €250 million dividend and a share repurchase program worth up to €1.65 billion. Its common equity Tier 1 capital ratio stood at 13.3% at the end of September, above its target of approximately 13%.

For investors, the central question is whether higher interest income and planned efficiency gains can offset rising expenses and credit provisions. Although ING shares had gained roughly 15% this year before the latest results, Thursday's premarket decline suggests that investors are becoming more sensitive to earnings disappointments and the costs of restructuring.

We also reported ACEN secures ING loan for renewable project pipeline and corporate funding.

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