Rabobank warns of Ukraine crisis fallout

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The conflict in Ukraine and its potential impact on the world economy has led Rabobank, the largest Dutch mortgage lender, to warn of possible knock-on effects to its business.

The bank said its net profit slipped by 3% to €1.1bn (£880m) in the first half of the year, owing to charges related to the Dutch bank SNS which was bailed out by the government.

The outlook for 2014 is uncertain, Rabobank said in a statement, partly due to the Ukraine crisis and the possible impact on the global economy.

"Russian sanctions can have an adverse impact on a number of our business customers and may therefore also adversely affect Rabobank's result to a limited extent," it said.

The sanctions are expected to cost the agriculture sector more than €300m in lost business this year.

The bank said its net result in the first six months of 2014 was reduced by a one-time €214m levy imposed on Dutch banks and it was not yet able to give guidance on the possible impact of the European Central Bank's asset quality review, or "stress test", of eurozone banks.

Rabobank' said it "was expecting a cautiously continuing economic recovery in the second half of the year", citing rising consumer consumption and positive signs in the housing market.

Powered by Guardian.co.ukThis article was written by Shane Hickey and agencies, for theguardian.com on Thursday 21st August 2014 09.45 Europe/London

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