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ING posts record second-quarter results: underlying net profit up 36.7%


•Underlying net profit up 36.7% to EUR 2,747 million on business and investment gains

-Profit includes a EUR 573 million net gain on the sale of part of ING’s stake in ABN Amro

-Underlying net profit increased 8.2% to a record EUR 2,174 million excluding that gain

-Strong volume growth in banking helps offset continued pressure from flat yield curves

-Expenses remain under control: up 4.2% including investments to support fast-growing businesses

-Net profit up 27.1% to EUR 2,559 million (EPS: EUR 1.18) after EUR 188 million for combining ING Bank and Postbank

-ING to pay interim dividend of EUR 0.66 per share, up 11.9% and equal to half of the total dividend paid over 2006

•Commercial momentum remains strong across our businesses

-Single-premium sales up 22.8% from 1Q as ING capitalises on global shift to wealth accumulation products

-Total value of new business up 23.2% from 1Q on strong SPVA sales in Japan and U.S. individual life reserves

-ING Direct adds record EUR 7.0 billion in own-originated mortgages in the second quarter

-Retail Banking shows solid volume growth in current accounts and mortgages in the Benelux and Poland

•ING continues to invest to accelerate the growth of its businesses

-Acquisitions of Oyak Bank in Turkey, Latin American pension business, Korean fund manager support growth

-ING to launch retail bank in Ukraine in 2008 as next step in eastward expansion strategy

-Single-premium variable annuity launched in Hungary in July as European roll-out continues

-Additional investments planned to boost growth at ING Direct in the second half of 2007

Chairman’s Statement

“ING posted strong results in the second quarter as the business continued to benefit from solid economic and market conditions. Results benefited from a gain on the sale of part of ING’s stake in ABN Amro, however this was a record quarter on an underlying basis without those proceeds,” said Michel Tilmant, Chairman of ING Group.

“At the banking business, volume growth in mortgages and current accounts continued to help offset pressure from flat yield curves and the interest margin stabilised in the second quarter from the first. Risk costs remained low, and there is no sign of a deterioration in the credit portfolio.”

“The life insurance businesses benefited from growth in assets under management and higher investment gains as stock markets rallied. ING is capitalising on a global shift from traditional life insurance to wealth accumulation products, reflected in a 22.8% increase in single-premium sales in the second quarter from the first. Strong sales of a new single-premium variable annuity product in Japan, as well as the execution of our strategy to address redundant regulatory reserves in the U.S. life business, resulted in a 23.2% improvement in the value of new life business in the second quarter from the first.”

“Operating expenses for the Group remained under control, with underlying expenses up 4.2% including additional expenses to grow the business.“

“ING is taking new initiatives to accelerate growth organically and through bolt-on acquisitions. The recent agreements to buy Oyak Bank in Turkey, the Latin American pension business of Santander, and Landmark Investment Management in South Korea will build scale and give ING access to attractive new markets. Preparations continue for the launch of ING Direct in Japan later this year. Additional investments of EUR 65 million are anticipated in the second half to accelerate the commercial growth of ING Direct. Next year we will launch a retail bank in Ukraine as we continue to expand ING’s retail distribution franchise eastward into the largest markets in the region.”

“Looking forward, ING’s proprietary investment portfolio is expected to produce substantial gains in the second half which we will partially reinvest to support further organic growth. Credit markets have very recently become more turbulent, however based on today’s market circumstances we expect no material impact on 2007 earnings. The commercial performance of the business remains robust and we are confident that ING’s risk profile and the diversification of our businesses will enable ING to continue to create value for shareholders while focusing on long-term growth.”

Press Conference, 8 August, 11.00 a.m. CET, ING House, Amsterdam

Analyst Conference Call: 8 August 09.00 a.m. CET.
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Analyst Conference Call: 8 August, 4 p.m.. CET
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Certain of the statements contained in this release are statements of future expectations and other forward-looking statements. These expectations are based on management’s current views and assumptions and involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those in such statements due to, among otherthings, (i) general economic conditions, in particular economic conditions in ING’s core markets, (ii) performance of financial markets, including developing markets, (iii) the frequency and severity of insured loss events, (iv) mortality and morbidity levels and trends, (v) persistency levels, (vi) interest rate levels, (vii) currency exchange rates, (viii) general competitive factors, (ix) changes in laws and regulations, and (x) changes in the policies of governments and/or regulatory authorities. ING assumes no obligation to update any forward-looking information contained in this document


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