AMSTERDAM (Reuters). ING Groep (AS:). NV, the biggest Dutch bank reported a 27% increase in its fourth quarter pretax profit, to 1.33 billion euro ($1.50billion), on the back of stronger loan growth and better fees income. However, it was below expectations.

According to Refinitiv data analysts had predicted a pretax profit in excess of 1.05 billion euros for 2020.

“I’m encouraged by increased lending volumes and strong fee income growth in the final quarter of 2021, a sign of growing confidence in the economy as the world seeks ways to live with the coronavirus,” CEO Steven van Rijswijk said in a statement.

The provision for bad loans increased from 208million euros to 356million euros. This was due to higher inflation and rising interest rates that could affect the ability of mortgage customers to pay.

The bank stated that COVID-19 had an adverse effect on the global economy but defaults in its portfolio were limited.

ING’s net margin for profitability fell to 1.37%, from 1.41%, compared with a year before. Low interest rates have put pressure on the bank, but it has reduced its rates for customer deposits.

The bank increased fees and commissions by 20%, to 925,000,000 euros, as it charged more retail customers for packages of banking, payments and investment products.

Customers loans increased 4.8%, or 13.4 billion euro to 632 billion Euros. Good growth was seen in wholesale banks customers as well as more German mortgage loan customers.

ING shares have risen 10% year-to-date and nearly doubled over the last 12 months.

($1 = 0.8850 euros)