SOURCE: FORTIS

May 13, 2008 01:40 ET

Fortis first quarter net profit of EUR 808 million driven by resilient operational performance

BRUSSELS, BELGIUM--(Marketwire - May 13, 2008) -


Despite challenging markets continued growth in income supported by strict cost management

* Sustained organic operational growth, especially in banking, and strict cost management result in a first quarter net profit of EUR 808 million, including EUR 380 million net of tax impact of the credit market turmoil.

* Banking

- First quarter net profit of EUR 721 million, including EUR 231 million of after-tax impairments on structured credit portfolio

- Income growth of 17% year-on-year driven by higher income from treasury and financial markets as well as strong underlying growth in net interest income in all banking businesses

- Strict cost containment resulted in a 2% increase in expenses and an improvement of the efficiency ratio

- Credit loss ratio of 12 basis points, excluding impairments on the structured credit portfolio, reflecting continued strong credit quality of loan portfolio

- Asset Management and Private Banking saw a net inflow of EUR 2.6 billion in the first quarter

- Good underlying pro forma net profit of acquired ABN AMRO activities of EUR 319 million

- Well on track with the integration of ABN AMRO, Asset Management transferred as per 1 April 2008

* Insurance

- First quarter net profit of EUR 219 million, including EUR 149 million of after tax impact of the credit market turmoil

- Life gross inflow up 5%, compared with a very strong first quarter 2007, to EUR 4.0 billion

- Non-Life gross written premiums advanced 3% to EUR 1.9 billion driven by strong growth in Belgium and the Netherlands

- Tight cost control in all countries resulted in a 2% increase in operating costs, fully related to the inclusion of Fortis Insurance Company Asia in Hong Kong

- Combined ratio of 96.6% in Non-Life due to improved efficiency and focus on profitable underwriting

* Net profit doubled compared to the fourth quarter which was heavily impacted by the write-downs on the structured credit portfolio, only partly offset by the gain on the sale of CaiFor

- Further growth in revenues quarter-on-quarter while costs were significantly lower as a result of a strict management, especially visible in non-staff related expenses

pdf version of the press release: http://hugin.info/134212/R/1218513/255338.pdf

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