Ing Groep N.v. · EURONEXT:INGA
Ing Groep — Q4 2021 Earnings Presentation
29 slides from Ing Groep's earnings presentation, Feb 3, 2022
Slide 1: Full year 2021 results
Full year 2021 results ING posts FY2021 net result of €4,776 mln 4Q2021 net result of €945 mln Steven van Rijswijk, CEO of ING 3 February 2022
Slide 2: Key points
Key points ▪ In 2021 our business model proved its strength under challenging conditions, as more Retail customers chose ING as their primary bank and a growing number of businesses turned to ING to support their green transition efforts ▪ Further growth of mobile interactions, with mobile becoming
Slide 3: FY2021 results
FY2021 results 3
Slide 4: Customers recognise ING's strengths
Customers recognise ING’s strengths Our primary customer base (in mln) Sustainability deals** (#) 317 30.5% 32.8% 34.3% 35.4% 37.4% 13.8 14.3 13.3 12.5 11.4 139 124 64 28 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 Primary as a % of total retail customers ▪ In 2021 our primary customer base gr
Slide 5: Mobile became the main channel for our customers
Mobile became the main channel for our customers Annual mobile non-deposit sales per Mobile-only active customers (in mln)* % mobile in interactions with ING 1,000 active customers (in #) 51% 91% 97 87% 40% 37% 82% 74 11.0 62 26% 8.7 73% 7.9 46 19% 5.2 63% 28 3.6 2017 2018 2019 2020 2021 2017 2018 2
Slide 6: Focus on diversifying income offset pressure on liability income
Focus on diversifying income offset pressure on liability income Net core lending and deposit growth Fee and commission income (in € bln) (in € bln) Total income* (in € bln) Δ € CAGR 41.4 18.1 18.3 18.5 +7% 17.7 17.6 3.5 36.6 7% 8% 7% 7% +2% 6% 3.0 30.6 15% 15% 16% 17% 19% +7% 2.7 2.8 2.9 26.9 23.4
Slide 7: NII stable, strong 17% fee growth in 2021
NII stable, strong 17% fee growth in 2021 Net interest income* (in € mln) Net fee & commission income per product category (in € mln) 3,517 13,714 13,916 14,079 13,604 13,615 483 2,868 3,011 2,714 2,803 1,064 832 850 668 761 924 850 13,132 1,022 1,021 963 1,040 670 881 682 678 341 343 403 430 489 20
Slide 8: Continued focus and measures taken on expenses
Continued focus and measures taken on expenses Regulatory expenses (in € bln) ▪ Higher FY2021 costs were driven by higher regulatory costs, 1.3 mainly due to an incidental 50% increase in the Dutch bank 1.0 1.1 tax for 2021 0.9 0.9 0.4 0.4 0.4 ▪ FY2021 expenses further included €522 mln of incidenta
Slide 9: FY2021 risk costs well below through-the-cycle average
FY2021 risk costs well below through-the-cycle average Risk costs (in € mln and in bps over customer lending) Stage 3 ratio 2,675 1.9% 1.7% 1.5% 1.5% 43 1.4% 1,120 676 656 516 18 12 11 8 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 ▪ Risk costs for 2021 were €516 mln, or 8 bps over average cust
Slide 10: Our 10-12% ROE ambition
Our 10-12% ROE ambition CET1 ratio and Return on Equity ▪ We run ING with a 10-12% through-the-cycle ROE ambition 15.9% ▪ 2021 ROE recovered, mainly reflecting lower IFRS 9 15.5% provisioning, while still being affected by several sizeable 14.7% negative incidentals in the P&L, other Covid-19 relate
Slide 11: ING's distribution plans in 2022 and beyond
ING’s distribution plans in 2022 and beyond ING’s Distribution Policy Distribution in 2022 and beyond ▪ Pay-out ratio of 50% of resilient net profit ▪ We are on track to reach our 10-12% ROE ambition ▪ Net profit adjusted for significant items not linked to the ▪ In line with our policy, we intend t
Slide 12: ING Group financial ambitions
ING Group financial ambitions Actual 2020 Actual 2021 Financial ambitions ~12.5%* Capital ▪ CET1 ratio (%) 15.5% 15.9% (Basel IV) ▪ ROE (%)** 4.8% 9.2% 10-12% (IFRS-EU Equity) Profitability ▪ C/I ratio (%)** 63.2% 60.5% 50-52% Distribution ▪ Distribution (per share) €0.12*** €0.89**** 50% pay-out ra
Slide 13: 4Q2021 results
4Q2021 results 13
Slide 14: Resilient NII; 4-quarter rolling average NIM broadly stable at 139 bps
Resilient NII; 4-quarter rolling average NIM broadly stable at 139 bps Net interest income (in € mln) Net Interest Margin (in bps) 3,344 3,513 3,340 3,388 3,374 233 83 84 84 146 144 140 140 139 3,344 3,280 3,257 3,304 3,290 141 142 138 137 136 4Q2020 1Q2021 2Q2021 3Q2021 4Q2021 4Q2020 1Q2021 2Q2021
Slide 15: Sustained mortgage growth, higher demand in WB
Sustained mortgage growth, higher demand in WB Customer lending 4Q2021 (in € bln) Core lending businesses: €13.4 bln 6.0 0.8 1.9 -0.3 -0.8 1.3 632.8 2.2 2.2 619.2 0.0 0.3 3Q2021 Retail NL Retail Retail Retail Other WB Lending WB DB&TF* WB Other* Lease / WUB Treasury FX / Other ** 4Q2021 Belgium Germ
Slide 16: Fee income strong
Fee income strong Net fee & commission income per business line (in € mln) Net fee & commission income per product category (in € mln) 882 925 882 925 854 855 854 855 771 771 105 140 322 113 130 278 302 295 94 255 247 261 233 284 248 278 232 247 269 235 220 253 232 198 219 281 295 322 338 336 246 23
Slide 17: Operating expenses under control
Operating expenses under control Expenses (in € mln) ▪ Expenses included €166 mln of incidental items, mainly due to €141 mln redundancy provisions and impairments related 3,016 2,947 to the announced discontinuation of the retail banking 2,914 activities in France. This compares to €223 mln of inci
Slide 18: Risk costs remain below the through-the-cycle average
Risk costs remain below the through-the-cycle average Risk costs per business line (in € mln) Stage 2 ratio* Stage 3 ratio 346 7.6% 7.0% 209 6.7% 6.7% 222 216 6.3% 30 5.8% 6.0% 6.0% 193 85 39 6.2% 5.3% 5.2% 19 35 5.9% 1.8% 1.8% 1.8% 1.7% 1.7% 66 107 35 96 95 5.2% 23 4.9% 4.7% -50 -76 1.7% 1.6% -149
Slide 19: Strong ING Group CET1 ratio at 15.9%
Strong ING Group CET1 ratio at 15.9% ING Group CET1 ratio development (in %) 15.8% 0.2% 0.0% -0.1% 15.9% ~12.5% 10.5% 3Q2021 CET1 ratio Profit added to CET1 Other capital movements RWA 4Q2021 CET1 ratio Basel IV CET1 ratio ambition Capital ratio CET1 developments SREP requirement Management buffer (
Slide 20: Wrap up
Wrap up 20
Slide 21: Wrap up
Wrap up ▪ In 2021 our business model proved its strength under challenging conditions, as more Retail customers chose ING as their primary bank and a growing number of businesses turned to ING to support their green transition efforts ▪ Further growth of mobile interactions, with mobile becoming the
Slide 22: Appendix
Appendix 22
Slide 23: Volatile items 4Q2021
Volatile items 4Q2021 Volatile items and regulatory costs (in € mln) 4Q2020 1Q2021 2Q2021 3Q2021 4Q2021 WB/FM – valuation adjustments -13 11 11 38 3 Capital gains/losses 3 36 -2 6 5 Hedge ineffectiveness -59 23 11 7 -24 Other items income* 0 233 155 50 92 Total volatile items – income -69 303 175 10
Slide 24: Challengers & Growth Markets FY2021
Challengers & Growth Markets FY2021* Germany** Spain Australia Italy ▪ Total income 2,568 mln ▪ Total income 776 mln ▪ Total income 771 mln ▪ Total income 335 mln ▪ Mortgages 85.8 bln ▪ Mortgages 21.0 bln ▪ Mortgages 34.6 bln ▪ Mortgages 7.3 bln ▪ Other lending 41.7 bln ▪ Other lending 8.9 bln ▪ Oth
Slide 25: Well-diversified lending credit outstandings by activity
Well-diversified lending credit outstandings by activity ING Group* Retail Banking* Wholesale Banking* Lending credit O/S* 4Q2021 Lending credit O/S* 4Q2021 Lending credit O/S* 4Q2021 10% 7% 23% 19% 38% 16% 20% 3% €787 €488 €488 €300 6% bln bln bln bln 8% 5% 54% 18% 9% 24% 62% 65% 13% Retail Banking
Slide 26: Our lending book is senior and well-collateralised
Our lending book is senior and well-collateralised Residential ▪ Average LTV of 57% with low Stage 3 ratio at 1.1% Mortgages ▪ Risk metrics remained strong €317 bln 6% Consumer Lending ▪ Relatively small book, risk metrics slightly improved 40% €27 bln 38% €787 bln ▪ Limited exposure to most vulnera
Slide 27: Provisioning per Stage
Provisioning per Stage Stage 1 provisioning (in € mln) Stage 2 provisioning (in € mln) Stage 3 provisioning (in € mln) 428 385 -30 -40 1 4 -168 63 2 3 7 11 -46 -7 -7 -86 -32 -43 56 -235 -201 36 8 8 300 220 237 -95 -42 -83 -110 -95 189 173 -159 169 135 -125 177 165 -73 127 54 68 4Q2020 1Q2021 2Q2021
Slide 28: Wholesale Banking lending
Wholesale Banking lending Loan portfolio is well diversified across geographies… …and sectors Lending Credit O/S* Wholesale Banking Lending Credit O/S* Wholesale Banking 1% NL 1% 10% Real Estate, Infra & Construction 13% 23% Belux Commodities, Food & Agri 23% 2% Germany TMT & Healthcare 16% Other Ch
Slide 29: Important legal information
Important legal information 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