ING Groep N.V. · EURONEXT:INGA
ING Groep — ING Insurance — IPO Roadshow (September 2013)
41 slides from ING Groep's IPO roadshow presentation, Sep 19, 2013
Slide 1: ING Insurance: Update on preparations for the IPO
ING Insurance Update on preparations for the IPO of ING Insurance Lard Friese Member of the Management Board Insurance EurAsia London – 19 September 2013 www.ing.com
Slide 2: Key points
Key points • ING Insurance forms a unique combination of mature and growth markets • Our strategic plans will extract the full value of our leading market positions • We are committed to focus on customers, generate capital, grow profitably, and improve efficiency • Our financial performance is star
Slide 3: A unique combination of mature and growth businesses
A unique combination of mature and growth businesses Leading market positions* #1 Life #1 Pensions • Leading positions in the large Dutch market Netherlands Poland #3 Non-life #7 Life • Strong footprint in key CEE markets, rapid expansion in Turkey • Well positioned to leverage scale advantage in ma
Slide 4: Clear strategic priorities have been set for each business
Clear strategic priorities have been set for each business Netherlands International Investment Management Corporate Line • NN Life • Mature • In-House • Debt interest • NN Non-life • Emerging • Third-Party • Central costs • NN Bank • Accelerate expense • Accelerate profitable growth • Continue soli
Slide 5: Our strategy focuses on customer, efficiency and capital generation
Our strategy focuses on customer, efficiency and capital generation Appealing products and services Multi-access distribution Efficient and effective operations • We offer appealing and easy to • We invest in long term relationships • We develop flawless processes understand products and services •
Slide 6: We are transforming our business to improve operating performance
We are transforming our business to improve operating performance • Simplified organization • 1,350 FTE reduction programme on track Organization • Renewed, highly motivated leadership team • Strong capital generation at NN Life in 1H2013 offset by French downgrade affecting ECB AAA Curve in July •
Slide 7: ING Insurance provides an attractive investment proposition
ING Insurance provides an attractive investment proposition • Leading market positions focused on customer, efficiency and capital generation • Individual Life closed book management Extract full potential from NN, • Group Life and Non-life re-pricing and in-force book management the Dutch market le
Slide 8: Netherlands
Netherlands ING Insurance Update - 19 September 2013 8
Slide 9: Extract full potential from leading market position
Extract full potential from leading market position • NN is the largest player in the Dutch market with a very powerful, multi-channel brand • Focus on customer excellence, expense reductions and capital generation • NN Life is effectively responding to changing dynamics in the Dutch Life market • C
Slide 10: NN is a leading player in the Netherlands
NN is a leading player in the Netherlands, the fifth largest insurance market in Europe The Netherlands GWP by product FY2012 EUR 35.2 bln 14% GWP • Individual Life EUR 11.1 bln 29% insurance • Group Life EUR 7.9 bln market EUR • Non-life EUR 16.2 bln 17% 5.3 bln Individual Life Life 20.2%, # 1 Grou
Slide 11: NN Life is effectively responding to significant changes in the Dutch market
NN Life is effectively responding to significant changes in the Dutch market Changing dynamics in the Dutch Life market NN is well positioned to respond to these changes… • Difficult economic outlook, low interest rates, rising life • #1 in Individual Life and first mover in closed book market expec
Slide 12: NN Life continues to execute its Individual Life closed book strategy
NN Life continues to execute its Individual Life closed book strategy Closed book strategy has significantly increased efficiency And will lead to further efficiency gains over the next 5 years • Stopped most new business • Further simplify business model to variabilise cost base • Transformed a 620
Slide 13: Group Life reduces risk and generates capital
Group Life reduces risk and generates capital Total pension technical reserves 2Q2013 Decisive management actions will reduce our risk profile and generate capital over the next five years 19% 8% • Guiding existing and new customers from average career and final pay (DB) to DC pension plans over tim
Slide 14: …and improves efficiency at the same time
…and improves efficiency at the same time Efficiency actions • We are rationalizing our current product-suite • We have ring-fenced legacy books to lower cost and improve efficiency • Within a new IT solution (SAP), we launch a standardised and focused product suite for average career and final pay
Slide 15: We are well positioned to capture growth in the Group pension market
We are well positioned to capture growth in the Group pension market Move from DB to DC Buy-out market Pension roll-over • Within the insurance sector, • Smaller company pension funds liquidate • Roll-over • New web based DB and DC customers move from DB to and move to insured solutions potential in
Slide 16: AZL delivers strong top-line fee growth
AZL delivers strong top-line fee growth AZL is a multi client, full service pension provider for pension funds Fee based revenues (EUR mln) and employers 35 36 37 • AZL delivers pension administration, communication, actuarial, risk and legal advice 21 • It is showing strong growth figures in fees a
Slide 17: NN Life strategy translates into continued expense reductions
NN Life strategy translates into continued expense reductions NN Life* administrative expenses (in EUR mln) • NN Life has reduced its administrative expenses by 38% since 2007 -38% driven by a strong reduction in FTEs • The realisation of continued cost savings in 2011 and 2012 have 696 been offset
Slide 18: Non-life profitability is being restored to historical levels
Non-life profitability is being restored to historical levels NN Non-life* operating result (in EUR mln) NN Non-life performance to improve gradually following actions taken 300 110% • Non-life in the Netherlands is a diversified block of business • GWP has been stable around EUR 1.6 bln over the pa
Slide 19: Group Income protection combined ratio to improve on measures taken
Group Income protection combined ratio to improve on measures taken We took decisive action in 2012 to address high claims in Group Income protection… ...which are starting to yield a positive effect • Results in 2012 were affected by high claims experience and Group Income protection reserve streng
Slide 20: Further actions taken to improve performance and grow selectively
Further actions taken to improve performance and grow selectively Further actions to improve total NN Non-life combined ratio • Individual D&A, fire and motor retail: improve underwriting performance by premium increases, adjusting conditions, disciplined underwriting, and improving claims handling
Slide 21: NN Bank will complement product range of NN
NN Bank will complement product range of NN Transfer of WUB to NN Bank completed NN Bank is a good strategic fit with NN and complements NN’s retail product offering • Nationale-Nederlanden Bank received a banking • NN Bank will offer a range of complementary products license in 2011 to enter the ta
Slide 22: Wrap up
Wrap up • ING Insurance forms a unique combination of mature and growth markets • Our strategic plans will extract the full value of our leading market positions • We are committed to focus on customers, generate capital, grow profitably, and improve efficiency • Our financial performance is startin
Slide 23: ING Insurance: Update on preparations for the IPO
ING Insurance Update on preparations for the IPO of ING Insurance David Knibbe CEO ING Insurance International London – 19 September 2013 www.ing.com
Slide 24: Attractive International businesses provide growth opportunity and strong cash generation
Attractive International businesses provide growth opportunity and strong cash generation • Very strong regional footprint and brand, organically built • Strategic focus on expanding life and third pillar pension business via multi distribution strategy • Double-digit growth in new business with foc
Slide 25: Strong regional footprint built organically
Strong regional footprint built organically Market shares and rankings (in GWP) Poland (‘95) Czech (’92) Slovakia (’96) Hungary (‘91) • Pension: #1 -24% market • Pension: #6 - 10% market • Pension: • Pension: MPF**** #1 -32% share share VPF* #1 - 37% market share VPF #6 – 7% market share • Life: #7
Slide 26: Diversified distribution and product mix in mature and growth markets
Diversified distribution and product mix in mature and growth markets Poland Turkey Czech & Slovakia Belgium Spain Total GWP 27.1 Total GWP 8.6 Total GWP 8.1 Total GWP 31.6 Total GWP 57.4 Total Market* Life GWP 15.7 Life GWP 1.2 Life GWP 4.0 Life GWP 20.7 Life GWP 26.2 EUR bln PF AUM 66.1 PF AUM 8.6
Slide 27: Accelerate profitable growth strategy and strong capital generation
Accelerate profitable growth strategy and strong capital generation Trends Our response • Growth in Bancassurance (BA) • Enhance value of current and new preferred Shifts in • Increased distribution through brokers BA partnerships channel mix • Inroads by direct channel Multi-channel • Selective bro
Slide 28: Operating result and capital generation holding up well despite income pressure
Operating result and capital generation holding up well despite income pressure CRE operating result (EUR mln) Operating result 206 • Low interest rate environment and regulatory changes in 184 second-pillar pensions have put pressure on operating results • Sovereign debt crisis has impacted results
Slide 29: Strong growth Life and third-pillar pensions sales
Strong growth Life and third-pillar pensions sales • Life business continues to perform well, Life sales outweigh pensions, with Turkey being the exception accounting for approximately 50% of Polish (CRE APE EUR mln) profits Poland • Reduction in premium contributions and ban on client acquisition 2
Slide 30: Increase distribution productivity and reach through multichannel access
Increase distribution productivity and reach through multichannel access • Focussed on improved productivity and retention of tied agents Multi-channel proposition CRE Tied Agent • Initial impact of initiatives has been positive APE, FY2011 3% • Selective broker growth in Czech Republic, Turkey, and
Slide 31: Long term partnership with ING Bank offers attractive growth opportunities
Long term partnership with ING Bank offers attractive growth opportunities Deposit & loans: # retail clients Entity market shares and rank (mm) # branches • 7.4% (deposits) 3.1 439 Bank Slaski • 4.8% (loans) • #5 (deposits); #6 (loans) • 1.7% (deposits)1 4.71 306 ING Bank Turkey • 2.3% (loans)1 • #1
Slide 32: Cost control and shifting product mix to mitigate external challenges
Cost control and shifting product mix to mitigate external challenges CRE Life product mix Growth of higher margin Life products FY2011 1H2013 • Successful shift in product mix towards higher margin products like investment and risk protection products 23% 30% 46% 39% Unit Linked Traditional Savings
Slide 33: Attractive International businesses provide growth opportunity and strong cash generation
Attractive International businesses provide growth opportunity and strong cash generation • Very strong regional footprint and brand, organically built • Strategic focus on expanding life and third pillar pension business via multi distribution strategy • Double-digit growth in new business with foc
Slide 34: ING Insurance: Update on preparations for the IPO
ING Insurance Update on preparations for the IPO of ING Insurance Stan Beckers CEO ING Investment Management London – 19 September 2013 www.ing.com
Slide 35: Investment Management is profitable and growing
Investment Management is profitable and growing • Investment Management (IM) has a strong position in home markets and CEE • Global investment capabilities and distribution reach • Scalable platform with capacity to leverage cost base further with more revenue • Focus on growing third party business
Slide 36: Investment Management has a strong position in Benelux and CEE
Investment Management has a strong position in Benelux and CEE AuM: type of client at 2Q2013 Key competitive strengths of Investment Management • EUR 176 bln in Strong client reach/distribution foothold, especially in “home 42% 32% assets under management at markets” (i.e. Benelux) – through both
Slide 37: Investment Management has built its profit model on its core values
Investment Management has built its profit model on its core values Core Value Value Operating Profit values proposition Chain model Model • Client centric • Client: serve clients • Institutional • Focus by making a • Leverage Retail and “We are here to serve the clients with high quality and • Inte
Slide 38: Our investment performance is recognized in the industry
Our investment performance is recognized in the industry Fund performance vs benchmark • Distinct offering in Fixed Income, Equity and Multi Asset strategies, managed through 9 boutiques. 79% 73% 71% 73% 71% • 289 investment professionals spread globally 65% • Our performance is recognized by the in
Slide 39: Investment Management will grow revenues by focusing on third-party business
Investment Management will grow revenues by focusing on third-party business Fee income on AuM 1H2013 To successfully grow the top line, IM is focusing to deliver in 4 specific areas 17% 83% 1. General Account: continue to build on our already successful track record 2. Closely cooperate with Insura
Slide 40: …and continues to provide steady profits and strong capital generation
…and continues to provide steady profits and strong capital generation Operating result before tax (in EUR mln) 124 • IM has historically provided recurring and steady profitability, 109 despite unfavourable market conditions • Capital generation has been strong in past years including 72 upstream o
Slide 41: Disclaimer
Disclaimer 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, the same accounting principles are applied as in the 2Q2013 ING Group Interim Acco