(by M. Riley)

The biggest Dutch bank ABN Amro reported third-quarter net profit growth of 26.3% despite of its U.S. mortgage business decline.

Net profit growth for the third quarter rose 26.3% to €1.05 billion. Its loan loss provisions fell 64.7% to €107 million.

The bank’s Dutch unit performing better in the quarter, as well as the €213 million gain from its Bank of Asia stake sale were the key factors for profit rise, said ABN Amro Chief Executive Rijkman Groenink. Growth in operating earnings in the Dutch unit and its wholesale division "partly compensated for the results of the Business Unit North America, which were disappointing due to the significant deterioration in mortgage market conditions in the United States compared with the previous quarter," ABN Amro said in its statement.
ABN Amro net profit forecast for 2004 accounts for at least 10% without the Bank of Asia stake sale gain, the company said in its statement.

``With the withdrawal of the defense mechanism ABN Amro can now be considered a takeover target. The combination of excess capital, restructuring and low valuation makes it a potential target,” said Martine Deroanne, an analyst at Fortis Bank.