ING back in the black

ING Groep NV, the Amsterdam, Netherlands, banking and insurance company, returned to profitability in the second quarter, earning £229 million ($325.8 million). While this is a steep drop from the £1.95 billion ($2.91 billion) the financial services giant earned in the second quarter of 2008, it marks a turnaround from a loss of £305 million ($415 million) in the first quarter of 2009. Chief executive Jan Hommen attributed ING’s return to the black to improvements in the equity and credit markets, plus the company’s efforts to shrink the company by trimming its lines of business and concentrating on select markets. In the year’s first half, ING achieved 53% of its targeted £1 billion ($1.42 billion) cost savings. The company predicted that it will cut costs by £1.3 billion ($1.85 billion) for the full year. ING said it had cut operating expenses by 5.5% on a year-over-year basis and eliminated 8,219 full-time positions by the end of the second quarter. This puts it ahead of the 7,000 job cuts it had planned for the full year. In the company’s insurance business, second-quarter earnings fell to £278 million ($395 million), from £1.04 billion ($1.55 billion) in the year-earlier period. ING said it has eliminated its interim dividend and is reviewing other ways to slim down and repay the Dutch government, which loaned the company £10 billion ($14.1 billion) last October.