ING to cut jobs on profit dip
ING Groep NV, the biggest Dutch financial-services company, will cut 2,350 jobs in its banking and insurance units after reporting a 64 percent fall in third-quarter profit. Net income fell to 609 million euros (US$783 million) from 1.69 billion euros a year earlier, the lender said in a statement. Profit fell after losses on hedges protecting the insurer’s capital and a charge related to changed policyholder behavior assumptions at its US annuity unit. Amsterdam-based ING said yesterday it would cut 1,350 jobs by 2014 and another 1,000 in commercial banking to make savings of 460 million euros annually from 2015.
August GDP fell 0.6%
The economy contracted for the first time since February 2010, as the debt crisis weighed on demand for Finnish goods. GDP adjusted for working days shrank an annual 0.6 percent in August, compared with a revised 0.1 percent growth in July, Helsinki-based Statistics Finland said yesterday, citing trend indicator data. Revisions to the GDP data may be “significant,” particularly when economic cycles turn, the statistics office said.
BNP earnings recover
France’s largest bank, BNP Paribas SA, yesterday said its profit bounced back in the third quarter after being slammed by exposure to Greek debt last year. The bank said that third-quarter profit reached 1.3 billion euros, up from 541 million euros in the same period last year, when it was hit by a huge writedown on Greek debt. The growth in earnings was largely due to strong investment banking activity. Its investment banking unit, CIB, saw pretax profit rise 7.3 percent to 732 million euros.
Burberry beats forecasts
British luxury goods group Burberry beat forecasts with a 6 percent rise in first-half pretax profit, as its most wealthy shoppers continued to spend despite a faltering global economy. The group, best known for its camel, red-and-black check pattern, yesterday said it made a profit before tax and one-off items of ￡173 million (US$276 million) in the six months to Sept. 30. Total first-half revenue was ￡883 million, up 8 percent at constant exchange rates, with first-quarter growth of 11 percent slowing to 5 percent in the second.
TEPCO seeks more aid
Tokyo Electric Power Co (TEPCO), the Japanese operator of the nuclear power plant devastated in last year’s disasters, is seeking more government financial support, saying the cost of the cleanup may be double its original estimate of ￥5 trillion (US$62.5 billion). TEPCO made the appeal in a management “action plan” it presented yesterday. The firm received a ￥1 trillion bailout and was put under government ownership. It has raised electricity rates to help cover the costs it faces due to the accident.
Moody’s lifts Japan outlook
Moody’s Investors Service raised its outlook for Japan’s banking system to “stable” from “negative,” citing prospects for modest economic growth, as well as strong capital and access to funding. The change is the first since Moody’s assigned the negative outlook in 2008, it said in a statement yesterday. Japanese authorities remain willing to support troubled banks, which is credit positive, Moody’s said, adding that risks to banks from their holdings of Japanese government bonds were low.