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ABN Amro suffers net loss of US$1.2b

ABN Amro Group reported a net loss of 866 million euros (US$1.21 billion) for the first quarter yesterday, due to losses at businesses owned by Royal Bank of Scotland PLC.

In the same period a year ago, the group's predecessor ABN Amro Holding NV reported a net profit of 3.6 billion euros.

That was before the financial crisis and before the company's three-way takeover by RBS, Banco Santander of Spain and Fortis NV of Belgium went disastrously wrong.

The Netherlands nationalized the Dutch parts of ABN as their would-be acquirer Fortis teetered on the edge of bankruptcy. The British government acquired 70.3 percent of RBS to save it from insolvency.

ABN Amro Group is jointly owned by the three banks that together bought ABN, with the Dutch state replacing Fortis as a partner.

The group continues to hold the formal title to most of the former ABN Amro Holding NV businesses, though Santander now has full control over the operations it bought in Latin America.

Legal separation of the remaining businesses is likely by late this year.

ABN Amro said yesterday that the RBS-owned businesses it controls lost 928 million euros in the first quarter, which RBS has reported as part of its quarterly results.

Asset impairments and loan losses were major factors of the reported loss.

ABN said businesses owned by the Dutch state, which are mostly retail banking operations in the Netherlands, had earnings of 87 million euros in the first quarter. That is down from 226 million euros in the same period a year earlier.

The company cited falling interest income and higher loan losses as reasons for the decline.


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