ABN Amro Earnings: Net Interest Margins Disappoint the Market; Value Remains for Long-Term Investors

Narrow-moat ABN Amro reported earnings/share of EUR 0.85 for the third quarter of 2023, slightly ahead of the EUR 0.80/share recorded a year earlier and materially ahead of the company-compiled consensus estimate at EUR 0.66/share. However, net interest income came in below expectations, disappointing the market, and the ABN Amro share price declined by 9% on Nov. 8. We are puzzled by this reaction. We already highlighted our view that NIM expansion peaked in our comment on the previous quarter's results. As expected, there were no further details on the return of excess capital. ABN Amro previously indicated that they will only update the market about their capital strategy at the beginning of next year.