Dutch financial services group ING registered a loss of 793 million euros (1,085 million U.S. dollars) in the first quarter of this year as asset prices continued to fall due to the fallout of the financial crisis, the group said Wednesday.
The Amsterdam-based group said in a statement on its website that its banking arm booked a profit before tax of 443 million euros (606 million dollars), while the insurance arm sustained a loss of 1.32 billion euros (1.81 billion dollars) largely due to the declining asset prices.
ING made a profit of 1.54 billion euros (2.11 billion dollars) in the first quarter of 2008, and posted a 729-million-euro (997-million-dollar) loss over the year as a whole.
The group received a capital injection of 10 billion euros (13.68 billion dollars) from the Dutch state in October last year and later secured a government guarantee for 80 percent of its toxic U.S. loan portfolio.
ING Chief Executive Officer Jan Hommen said in a statement that the market conditions had been "challenging" in the first quarter "as equity markets declined further, credit spreads remained elevated, real estate prices continued to fall and loan losses increased as the crisis spread from the financial markets to the real economy."
"This year will remain challenging as markets are volatile and the economic environment continues to be uncertain," he said.
Hommen said the group's priorities now are to reduce costs and risk and to reduce complexity by focusing on fewer businesses and markets.
ING has cut its operating expenses by 3.5 percent compared to the first quarter last year and over 75 percent of the planned 7,000 job reduction has been completed as the end of March. Hommen said the group is on track to cut expenses by 1 billion euros (1.37 billion dollars) this year.
In order to simplify governance and increase business focus, the group will create separate management boards for banking and insurance, Hommen said.