ING Groep NV (ING) Q1 2022 Earnings Call Transcript

For the period ending March 31, 2022

May 6, 2022 3:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Welcome to ING First Quarter 2022 Conference Call [Technical Difficulty] regarding future developments in our business, expectations for our future financial performance and any statement not involving an historical fact. Actual results may differ materially from those projected in any forward-looking statements. A discussion of factors that may cause actual results to differ from those in any forward-looking statements is contained in our public filings, including our most recent Annual Report on Form 20-F filed with the United States Securities and Exchange Commission. And our earnings press release as posted on our website today.

Furthermore, nothing in today's comments constitutes an offer to sell or a solicitation of an offer to buy any securities.

Good morning, Steven, over to you.

Steven van Rijswijk

Thank you very much, operator. Good morning, and welcome to our first quarter 2022 results call. I hope you're all well. I'm joined by our CFO, Tanate Phutrakul; and our CRO, Liliana Cortan. And I'm pleased to take you through today's presentation. After that, we will take your questions.

For the first time in 2 years, I started this presentation by saying that from a cover perspective, circumstances seem to be normalizing, which is positive. However, challenges remain with the invasion of Ukraine, which is adversely affecting people, including our colleagues as well as already high energy prices and disruptive supply chains.

In these circumstances, we help colleagues to safely relocate and manage the risk of our risk-related exposure. At the same time, we focus on our strategic priorities by financing the green transition and improving our digital channels, and we continue to deliver value.

This was reflected in the higher preprovision profits, driven by -- and highlight our efforts to finance a green transition and to improve our mobile channel. Operating profit was up 14% year-on-year and 9% quarter-on-quarter, a strong start to 2022. And I'm particularly happy that all key P&L lines contributed.

NII, excluding TLTRO, was up on both comparable quarters, which is a meaningful signal in the context of the liability pressure of the past years. With the yield growth normalizing, we can reinvest our replicating portfolio and more positive yields. And as we always said, the effect will come in over time. However, over 2021, we had approximately €600 million drag from negative rates. That drag has now disappeared. Excluding TLTRO, we expect NII to be up in 2022. At the same , ECB has not yet increased rates. So for now, a negative interest rate charging remains in place with the current contribution of €300 million for the full year.