AMSTERDAM (Reuters) – Rabobank reported a 29% fall in first-half net profit on Thursday, which the Dutch cooperative lender blamed on rising impairment charges, restructuring costs and low interest rates.
Rabobank, the largest Dutch mortgage bank and a leading lender in the North American agriculture sector, said net profit fell to 1.2 billion euros (1.1 billion pounds) in the six-month period from 1.7 billion euros a year earlier.
Impairment charges on financial assets increased by 477 million euros from the first half of 2018, which equates to 21 basis points of the average loan portfolio, versus a long-term average of 32 basis points, said the bank, whose main domestic rivals are ABN Amro <ABNd.AS> and ING <INGA.AS>.
“Significant impairments were seen in the Netherlands, France and Brazil,” it said. “At the current level impairment charges are trending upward towards the long-term average.”
Rabobank Chairman Wiebe Draijer said global economic developments threatened stability and growth prospects, although the company did not provide a specific financial outlook.
“Take for example the escalating trade war between the United States and China, the growing likelihood of a hard Brexit and the persistent low interest rate environment,” Draijer said in a statement.
The bank, which has been going through a long restructuring, said its global staff numbers declined nearly 4% to just under 42,000.
(Reporting by Anthony Deutsch; Editing by David Holmes)