All change

26 Apr 2006 By Mike Verdin

The Dutch bank struggled in Q1. Wholesale dragged down the US. The investment bank declined despite benign trading conditions. That’s a sign of the huge task ABN has taken on in revamping wholesale and absorbing Antonveneta. Extra cost cuts will add to the workload.

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ABN Amro, the Dutch bank, reported a 12.1% rise to E1bn in first quarter earnings on revenues up 27% at E5.6bn. Costs rose 26% to E3.9bn. Excluding Antonveneta, the Italian bank ABN has controlled since January 2, revenues grew by 18% and costs by 16%.

The group's return on equity of 17.9% compared with an average of 23.5% for 2005. ABN is targeting an average return on equity of at least 20% between 2005 and 2008.

The group raised its target for a cost cuts programme by E150m to E900m between 2005 and 2008. The savings will cost E245m to achieve this year. ABN will book a restructuring charge of between E125m and E150m in the second quarter.

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