ING 3Q2020 result before tax of €1,204
million |
• |
Resilient result,
with increased fee income and continued operational cost control;
net interest income declines due to liability margin pressure,
subdued lending growth and negative foreign currency impact |
• |
Result reflects
significantly lower risk costs compared to 2Q2020, and impairments
on our equity stake in TMB and on capitalised software |
|
ING provides capital update with revised CET1 ambition and
distribution policy |
• |
New CET1 ratio
ambition of around 12.5%, implying a ~200 bps buffer over current
minimum regulatory requirements; our current CET1 ratio is
15.3% |
• |
New distribution
policy of a 50% pay-out ratio of resilient net profit, in cash or a
combination of cash and share repurchases |
CEO statement“Helping colleagues, customers and communities
safely through the Covid-19 pandemic remains a top priority, and
I’m proud of how ING has stepped up to deal with this challenge,”
said Steven van Rijswijk, CEO of ING Group. “The pandemic continues
to have a significant impact everywhere, with the second wave in
Europe and the US putting further pressure on consumers and
businesses. Looking back, ING’s third-quarter results were
resilient, with increased fee income from diversified income
sources, coupled with good cost control and lower risk costs. We
saw a reduction in net interest income resulting from margin
pressure on liabilities combined with lower lending demand. Our
easy, smart and personal digital-first offering keeps attracting
customers, with a net increase of 213,000 primary customers over
the quarter. “Our ambition to keep transforming into a leading
data-driven digital bank remains firm. However, the challenging
external environment requires that we remain flexible in ‘how’ and
‘where’ we deliver our Think Forward strategy. We are therefore
refocusing our activities to ensure faster client delivery and a
continuously improving end-to-end digital customer experience. In
Wholesale Banking, we will concentrate even more on core clients
and simplify our geographical footprint, which will require fewer
staff. This includes closing our offices in South America and some
in Asia, while continuing to serve the international needs of
clients from our regional hubs. “In further developing our
digital universal bank we’ll focus our efforts on three things: the
global use of ING’s technology foundation – which includes our
shared data lakes, cloud and modular IT building blocks; the re-use
where possible of already developed mobile app components; and the
rollout of global digital product offerings in the areas of
insurance, investments and consumer lending. We’ve therefore
decided to considerably reduce the scope of Maggie, a programme
launched to provide a standardised customer experience and
integrate the product offering in four of our European Challenger
countries. The decision has been taken in light of the current
economic headwinds and our learnings from the complexities and
costs of cross-border system and product integration. “The
change in Maggie’s scope has led to an impairment of €140 million,
primarily related to capitalised software development costs. The
refocusing of our wholesale and retail activities will result in a
headcount reduction of approximately 1,000 FTEs by year-end
2021. “Today, we provide a capital update. Our new long-term
CET1 ratio ambition level of around 12.5% translates into a ~200
bps buffer over current minimum regulatory requirements. We will
manage well above this ambition level while Covid-19-related
uncertainties remain. We also introduce a new distribution policy
of a 50% pay-out ratio of resilient net profit, in the form of cash
or a combination of cash and share repurchases. We believe this
offers a sustainable and attractive return, and we will
periodically review whether ING has structural excess capital
available to return to shareholders. The execution of this policy
will comply with prevailing ECB recommendations on shareholder
distributions. “We stay focused on our gatekeeper role and
ensuring the security and compliance of the bank. Thanks to our KYC
enhancements, ten more countries are now connected to our adverse
media screening tool. We also support initiatives to collectively
fight financial crime together with other banks and law enforcement
and regulatory authorities. And we remain resolute in our efforts
to combat the climate crisis and contribute to a low-carbon
society. Our second Terra report now includes our targets for how
we will align our lending with the Paris climate goals in our nine
most carbon-intensive sectors. I’m proud of the progress we
continue to make, and how we’re living up to the transformational
role we play in the economy and in society.” |
|
Further information All publications related to ING’s 3Q 2020
results can be found at www.ing.com/3q20. Additional financial
information is available at www.ing.com/qr: • Full ING Group
3Q2020 press release (PDF) • ING Group analyst presentation (PDF,
also available via SlideShare) • ING Group historical trend data
(PDF, XLS) For further information on ING, please visit
www.ing.com. Frequent news updates can be found in the Newsroom or
via the @ING_news Twitter feed. Photos of ING operations, buildings
and its executives are available for download at Flickr. ING
presentations are available at SlideShare. |
|
Investor conference call, Media conference call and webcasts Steven
van Rijswijk and Tanate Phutrakul will discuss the results in an
Investor conference call on 5 November 2020 at 9:00 a.m. CET.
Members of the investment community can join the conference call at
+31 20 341 8221 (NL), +44 203 365 3209 (UK) or
+1 866 349 6092 (US) and via live audio webcast at
www.ing.com. Steven van Rijswijk and Tanate Phutrakul will
also discuss the results in a Media conference call on 5 November
2020 at 11:00 a.m. CET. Journalists are welcome to join the
conference call via +31 20 531 5855 (NL) or +44 203 365 3210 (UK).
The meeting can also be followed via live audio webcast at
www.ing.com. |
|
Investor enquiries T: +31 20 576 6396 E:
investor.relations@ing.com Press enquiries T: +31 20 576 5000
E: media.relations@ing.com |
|
ING Profile ING is a global
financial institution with a strong European base, offering banking
services through its operating company ING Bank. The purpose of ING
Bank is empowering people to stay a step ahead in life and in
business. ING Bank’s more than 55,000 employees offer retail and
wholesale banking services to customers in over 40
countries. ING Group shares are listed on the exchanges of
Amsterdam (INGA NA, INGA.AS), Brussels and on the New York Stock
Exchange (ADRs: ING US, ING.N). Sustainability forms an
integral part of ING’s strategy, evidenced by ING’s leading
position in sector benchmarks by Sustainalytics and MSCI and our
‘A-list’ rating by CDP. ING Group shares are included in major
sustainability and Environmental, Social and Governance (ESG) index
products of leading providers STOXX, Morningstar and FTSE
Russell. |
|
IMPORTANT LEGAL INFORMATION
Elements of this press release contain or may contain information
about ING Groep N.V. and/ or ING Bank N.V. within the meaning of
Article 7(1) to (4) of EU Regulation No 596/2014. ING Group’s
annual accounts are prepared in accordance with International
Financial Reporting Standards as adopted by the European Union
(‘IFRS- EU’). In preparing the financial information in this
document, except as described otherwise, the same accounting
principles are applied as in the 2019 ING Group consolidated annual
accounts. All figures in this document are unaudited. Small
differences are possible in the tables due to
rounding. Certain of the statements contained herein are not
historical facts, including, without limitation, certain statements
made of future expectations and other forward-looking statements
that are based on management’s current views and assumptions and
involve known and unknown risks and uncertainties that could cause
actual results, performance or events to differ materially from
those expressed or implied in such statements. Actual results,
performance or events may differ materially from those in such
statements due to a number of factors, including, without
limitation: (1) changes in general economic conditions, in
particular economic conditions in ING’s core markets, including
changes affecting currency exchange rates, (2) the effects of the
Covid-19 pandemic and related response measures, including
lockdowns and travel restrictions, on economic conditions in
countries in which ING operates, on ING’s business and operations
and on ING’s employees, customers and counterparties, (3) changes
affecting interest rate levels, (4) any default of a major market
participant and related market disruption, (5) changes in
performance of financial markets, including in Europe and
developing markets, (6) changes in the fiscal position and the
future economic performance of the United States, including
potential consequences of a downgrade of the sovereign credit
rating of the US government, (7) consequences of the United
Kingdom’s withdrawal from the European Union, (8) changes in or
discontinuation of ‘benchmark’ indices, (9) inflation and deflation
in our principal markets, (10) changes in conditions in the credit
and capital markets generally, including changes in borrower and
counterparty creditworthiness, (11) failures of banks falling under
the scope of state compensation schemes, (12) non-compliance with
or changes in laws and regulations, including those financial
services and tax laws, and the interpretation and application
thereof, (13) geopolitical risks, political instabilities and
policies and actions of governmental and regulatory authorities,
(14) ING’s ability to meet minimum capital and other prudential
regulatory requirements, (15) outcome of current and future
litigation, enforcement proceedings, investigations or other
regulatory actions, including claims by customers, (16) operational
risks, such as system disruptions or failures, breaches of
security, cyber-attacks, human error, changes in operational
practices or inadequate controls including in respect of third
parties with which we do business, (17) risks and challenges
related to cybercrime including the effects of cyber- attacks and
changes in legislation and regulation related to cybersecurity and
data privacy, (18) changes in general competitive factors, (19) the
inability to protect our intellectual property and infringement
claims by third parties, (20) changes in credit ratings, (21)
business, operational, regulatory, reputation and other risks and
challenges in connection with climate change, (22) inability to
attract and retain key personnel, (23) future liabilities under
defined benefit retirement plans, (24) failure to manage business
risks, including in connection with use of models, use of
derivatives, or maintaining appropriate policies and guidelines,
(25) changes in capital and credit markets, including interbank
funding, as well as customer deposits, which provide the liquidity
and capital required to fund our operations, (26) the other risks
and uncertainties detailed in the most recent annual report of ING
Groep N.V. (including the Risk Factors contained therein) and ING’s
more recent disclosures, including press releases, which are
available on www.ING.com. This document may contain inactive
textual addresses to internet websites operated by us and third
parties. Reference to such websites is made for information
purposes only, and information found at such websites is not
incorporated by reference into this document. ING does not make any
representation or warranty with respect to the accuracy or
completeness of, or take any responsibility for, any information
found at any websites operated by third parties. ING specifically
disclaims any liability with respect to any information found at
websites operated by third parties. ING cannot guarantee that
websites operated by third parties remain available following the
publication of this document, or that any information found at such
websites will not change following the filing of this document.
Many of those factors are beyond ING’s control. Any forward
looking statements made by or on behalf of ING speak only as of the
date they are made, and ING assumes no obligation to publicly
update or revise any forward-looking statements, whether as a
result of new information or for any other reason. This
document does not constitute an offer to sell, or a solicitation of
an offer to purchase, any securities in the United States or any
other jurisdiction. |