Ing Groep N.v. · EURONEXT:INGA
Ing Groep — Debt Investor Presentation (October 2024)
54 slides from Ing Groep's debt investor presentation, Oct 31, 2024
Slide 1: ING Credit Update 3Q2024
ING Credit Update 3Q2024 ING Investor Relations 31 October 2024
Slide 2: Continuation of our strong growth trajectory
Continuation of our strong growth trajectory Mobile primary customers1) Net core lending growth Net core deposits growth Total income +189,000 €+9 bln €+3 bln €17.2 bln YTD ▪ Continued growth in mobile ▪ Sustained strong ▪ Successful campaign in ▪ 3Q2024 total income at a primary customers performan
Slide 3: Sustainably increasing impact
Sustainably increasing impact Customers Our people Planet and society ▪ 83% customers use mobile as ▪ Top Employer in 5 countries in ▪ Publication of our 2024 Climate preferred channel Europe2) Progress Update ▪ #1 NPS in 5 Retail Banking markets ▪ Further roll-out of the Global ▪ €28.4 bln of susta
Slide 4: Consistently delivering value
Consistently delivering value Recent distributions to shareholders (in € mln)1) Key developments 2,500 2,497 2,500 2,500 ▪ Strong capital generation with four-quarter rolling RoE of 13.8% 500 and CET1 of 14.3% 1,130 ▪ €2.5 bln additional distribution 2,000 ▪ €2 bln share buyback, structurally increa
Slide 5: Poland is an example of how we are 'Growing the difference' in Retail
Poland is an example of how we are ‘Growing the difference’ in Retail Consistent customer growth with an increasing primary customer base Growing the difference 40% 41% 42% 47% 47% 48% 50% 51% 51% ▪ New value propositions and enhanced product 2.1 2.2 2.2 offering for GenZ 1.9 2.0 1.7 1.8 0.3 0.3 1.5
Slide 6: Strategic priority to be leading in financing the sustainable transition
Strategic priority to be leading in financing the sustainable transition Recent achievements and milestones Climate action roadmap 2025 Target to grow financing of renewable power generation to €7.5 bln annually ~2,000 clients Financing of coal-fired power phased out to scored on climate disclosures
Slide 7: Further improving our outlook for 2024
Further improving our outlook for 2024 Results 3Q2024 Mobile primary Total Fee Cost/income CET1 Return on customers income income ratio ratio equity 4-quarter rolling 2024 YTD 2024 YTD 4-quarter rolling 3Q2024 4-quarter rolling +893,000 €17.2 bln €3.0 bln 52.4% 14.3% 13.8% Outlook 2024 Mobile primar
Slide 8: Business profile
Business profile 8
Slide 9: Well-diversified business mix
Well-diversified business mix Retail Banking Retail Banking footprint Wholesale Banking Wholesale Banking ▪ Focus on earning the International Network ▪ A leading European primary relationship Netherlands Wholesale Bank, powered Belgium EMEA by: ▪ Technology to offer a Luxembourg Asia Pacific differ
Slide 10: Executing our strategy to be the best European bank
Executing our strategy to be the best European bank growing the difference Purpose Empowering people to stay a step ahead in life and in business Superior value for customers Uniquely Strategic pillars Sustainability at the heart ING Providing Staying seamless digital services safe & secure Enablers
Slide 11: Our focus SDGs are reflected in our Sustainability Direction
Our focus SDGs1) are reflected in our Sustainability Direction Environment Social Climate action Financial health Empowering our clients2) Empowering our customers3) by focusing on: ▪ We aim to steer the most carbon-intensive parts of our ▪ Financial inclusion by making bank products lending portfol
Slide 12: 3Q2024 results
3Q2024 results 12
Slide 13: Total income at a record level
Total income at a record level Total income (in € mln) Key developments ▪ Total income at a record level 5,909 ▪ Resilient core net interest income, 5,842 5,716 5,583 driven by continued growth in 5,408 680 618 374 495 customer balances 347 463 314 306 324 158 ▪ Strong performance in fee income 909
Slide 14: Customer balances continue to increase
Customer balances continue to increase Customer lending (in € bln) Main drivers Net core lending growth €+8.5 bln ▪ Strong growth in customer lending ▪ Growth in Retail Banking mainly 3.8 674.5 driven by strong performance in 0.6 0.1 2.1 5.7 mortgages across all markets 662.2 ▪ Continued growth in b
Slide 15: Resilient net interest income from lending and liabilities
Resilient net interest income from lending and liabilities Net interest 3Q2024 income remained NII development strong in 1Q2024 (in € mln) NII excl accounting asymmetry and one-offs €-128 mln Accounting asymmetry €18 mln 3,830 15 17 1 3,689 -35 -108 -31 NII 2Q2024 Liability NII Lending NII Other NII
Slide 16: Net interest margin impacted by Treasury
Net interest margin impacted by Treasury Net interest income (in € mln) Lending and liability margin (in bps) Net interest margin (in bps) 168 166 166 4,028 3,875 3,825 3,830 3,689 161 162 130 130 131 132 128 157 156 155 152 148 1,877 1,810 1,795 1,779 1,794 152 154 151 121 118 148 116 112 112 141 2
Slide 17: Continued strong liability margin in a lower rate environment
Continued strong liability margin in a lower rate environment Replicating income on Retail eurozone Total liability margin to stabilise at a 3-month EURIBOR forward curves customer deposits 100-110 bps Implied interest rates, end-of-period, in bps Interest income in € bln1) Average liability margin
Slide 18: Double-digit fee income growth to over one billion euro in 3Q2024
Double-digit fee income growth to over one billion euro in 3Q2024 Net fee & commission income per product category (in € mln) Main drivers +11% ▪ Strong structural year-on-year growth in fee income, driven by Retail Banking 998 999 1,009 909 879 ▪ +0.9 mln mobile primary 139 140 138 107 113 customer
Slide 19: Sustained focus on costs, while making investments in the business
Sustained focus on costs, while making investments in the business Development operating expenses (in € bln) +3% +7% 0.7 0.5 0.1 8.5 +1% +3% 8.8 0.1 +4% 8.2 7.6 -2% Total Regulatory Incidental Operating CLA / salary Danske VAT Business Operational Operating Regulatory Incidental Total expenses costs
Slide 20: Risk costs at the through-the-cycle average
Risk costs at the through-the-cycle average Risk costs per business line (in € mln)1) Stage 2 ratio Stage 3 ratio 11 5 16 18 20 1.9% 336 9.8% 8.9% 1.8% 300 8.0% 8.1% 7.6% 7.6% 1.6% 258 1.6% 1.6% 7.7% 7.3% 7.2% 1.5% 1.6% 191 6.8% 1.5% 183 93 202 7.5% 7.5% 15 6.9% 86 1.5% 1.5% 1.4% 1.5% 6.3% 1.4% 1.4%
Slide 21: Capital
Capital 21
Slide 22: Risk-weighted assets decreased, including a partial reversal of model updates
Risk-weighted assets decreased, including a partial reversal of previous quarter’s impact from model updates Risk-weighted assets development (in € bln) Credit RWA €-1.9 bln 330.9 -1.6 3.6 -1.8 -0.8 -1.3 -0.5 0.0 328.5 2Q2024 FX Volume Overall profile of Models, Other Market Operational 3Q2024 RWA i
Slide 23: CET1 ratio increased to 14.3%, pro forma 13.5%
CET1 ratio increased to 14.3%, with pro forma CET1 ratio at 13.5% when adjusted for the announced €2.5 bln additional distribution Total capital ratio development (in %) +3.0% 19.7% +2.4% 14.0% +0.3% -0.1% +0.1% 14.3% ~12.5% 10.9% 2Q2024 Profit added Other capital RWA 3Q2024 AT1 Tier 2 3Q2024 Total
Slide 24: Buffer to MDA remains strong
Buffer to MDA remains strong ING Group fully loaded SREP requirements ▪ Fully loaded CET1 requirement is 10.87% ▪ 4.50% Pillar 1 Requirement (P1R) MDA restriction ▪ 0.93% Pillar 2 Requirement (P2R) MDA level ▪ 2.50% Capital Conservation Buffer (CCB) restriction (15.09%) MDA level ▪ 0.94% Countercycl
Slide 25: Funding & liquidity
Funding & liquidity 25
Slide 26: Comfortably meeting TLAC and MREL requirements
Comfortably meeting TLAC and MREL requirements TLAC/MREL as percentage of RWA TLAC/MREL as percentage of leverage exposure 33.8% 9.6% 29.03% 14.1% 23.28% 5.28% 6.75% 7.32% 4.0% 5.28% 3.0% 0.9% 2.4% 0.7% 23.75% 14.3% 18.00% 4.0% TLAC/MREL TLAC MREL TLAC/MREL TLAC MREL eligible instruments requirement
Slide 27: Long-term debt issuance activity and maturity ladder
Long-term debt issuance activity and maturity ladder Issuance 2024 Currency split of outstandings as per 30 September 2024 ▪ Up to 3Q2024, ING has issued €~22.0 bln in long term debt HoldCo Senior Tier 2 AT1 consisting of: 8% 9% ▪ ~€2.0 bln AT1 2% ▪ ~€2.6 bln Tier 2 ▪ ~€8.1 bln Holdco Senior 34% 58%
Slide 28: Issuance across ING subsidiaries
Issuance accross ING subsidiaries ING Belgium ING Bank (Australia) ING Bank Hipoteczny ING Bank AS ING Bank N.V. S.A./N.V. ING DiBa AG Ltd (Poland) (Türkiye) Instruments ▪ Secured funding ▪ Secured funding ▪ Secured funding ▪ Secured funding ▪ Secured funding ▪ Capital overview ▪ Senior unsecured ▪
Slide 29: ING is dedicated to its Green Funding Programme
ING is dedicated to its Green Funding Programme Green Funding instruments objectives and added value External consultants & providers ▪ Support meeting our sustainability objectives ▪ Second party Opinion provider ▪ Fund growth in our Eligible Green Loan portfolio ▪ Continued leadership in the Green
Slide 30: ING Global Green Funding Framework 2024
ING Global Green Funding Framework 2024 ▪ Our new ING Global Green Funding Framework has been assessed by a Second Party Opinion (SPO) and is aligned with the latest ICMA Green Bond Principles 2021. The framework is presented through below four pillars: Use of proceeds Project evaluation and selecti
Slide 31: Project selection and management of proceeds
Project selection and management of proceeds ▪ Projects financed and/or refinanced through Green Bond proceeds are evaluated and selected based on compliance with the Eligibility Criteria Compliance with the Eligibility Criteria Management of proceeds ▪ ICMA Green Bond Principles categories ▪ Eligib
Slide 32: External verification
External verification SPO Opinion on the ING Global Green Funding Framework ▪ ISS’s overall evaluation of the Green Funding Framework’s sustainability quality of the eligibility criteria by ING is positive ▪ ING Green Funding Framework is in line with the latest ICMA Green Bond Principles ▪ Use of P
Slide 33: Strong balance sheet with customer deposits as the primary source of funding
Strong balance sheet with customer deposits as the primary source of funding Balance sheet ING Group (in € bln) Well-diversified customer loan book Assets Liabilities ▪ See “Asset Quality” section of this presentation 1,041 1,049 1,041 1,049 27 15 23 14 18 13 97 100 20 51 17 52 150 157 168 Stable fu
Slide 34: Robust liquidity position with a 12-month moving average LCR of 146%
Robust liquidity position with a 12-month moving average LCR of 146% Funding mix1) ING maintains a sizeable liquidity buffer 30 September 2024 ▪ ING’s funding consists mainly of retail deposits, corporate deposits and public debt 11% 2% Customer deposits (private individuals) 6% Customer deposits (o
Slide 35: Strong rating profile at both Group and Bank levels
Strong rating profile at both Group and Bank levels Main credit ratings of ING on 30 October 2024 Latest rating actions on ING Group and Bank S&P Moody’s Fitch ▪ S&P: upgraded ING Bank to A+ in July 2017. In June Stand-alone rating a baa1 a+ 2024, S&P affirmed ING's rating and outlook, reflecting S&
Slide 36: Asset quality
Asset quality 36
Slide 37: Addition to loan loss provisions per Stage
Addition to loan loss provisions per Stage Stage 1 provisioning (in € mln)1) Stage 2 provisioning (in € mln)1,2) Stage 3 provisioning (in € mln)1) 30 451 453 10 24 20 3 47 368 -4 -7 10 12 -31 -4 -23 -12 -4 -46 -65 -59 -81 -104 306 289 238 209 -16 -33 -100 -53 -84 89 156 -35 -94 -64 59 -147 149 159 1
Slide 38: Well-diversified lending credit outstandings by activity
Well-diversified lending credit outstandings by activity 1) ING Group Retail Banking Wholesale Banking 12% 6% 12% 33% 22% 16% 8% 20% €815 €545 5% €545 €270 bln bln bln bln 12% 21% 59% 5% 63% 17% 8% 67% 13% Retail Banking Residential mortgages Mortgages Netherlands Lending Wholesale Banking Consumer
Slide 39: Wholesale Banking lending credit outstandings
Wholesale Banking lending credit outstandings 1) Loan portfolio is well diversified across geographies… …and sectors Wholesale Banking Wholesale Banking 1% 10% NL 1% 9% Real Estate, Infra & Construction 16% Belux Commodities, Food & Agri 10% 11% TMT & Healthcare 2% Germany 34% Transportation & Logis
Slide 40: Appendix
Appendix 40
Slide 41: Issuance entities under our approach to resolution
Issuance entities under our approach to resolution Issuance entities Eligible instruments for Group TLAC/MREL Designated TLAC MREL resolution ING Groep N.V. entity ▪ Own funds (CET1 / AT1 / Tier 2) ✓ ✓ ▪ Senior unsecured debt (> 1 year) ✓ ✓ ▪ Secured funding & senior unsecured debt ING Bank N.V. (>
Slide 42: Comfortable buffer to Additional Tier 1 trigger
Comfortable buffer to Additional Tier 1 trigger Buffer to AT1 trigger (in € bln) ING Group available distributable items (in € mln) 30 September 2024 2023 2022 46.8 Share premium 17,116 17,116 Other reserves 29,167 30,859 Legal and statutory reserves -770 -984 €23.8 bln 7.3pp1) Non-distributable -6,
Slide 43: Outstanding benchmark capital securities per 3Q2024
Outstanding benchmark capital securities per 3Q2024 (Additional) Tier 1 securities Currency Issue date First call date Coupon Outstanding (mln)2) Reset spread USD Sep-24 Nov-34 7.250% 1,000 SOFR MS+408.4bps USD Feb-24 May-30 8.000% 1,250 SOFR MS+436bps USD Feb-23 May-28 7.500% 1,000 UST + 371bps USD
Slide 44: HoldCo Senior transactions in past 12 months
HoldCo Senior transactions in past 12 months ISIN Issue date First call date Maturity Tenor Coupon Issued (mln)1) Reset spread EUR XS2891742731 Sep-24 Sep-29 Sep-30 6nc5 3.50% 1,500 3mE+139.3 XS2891741923 Sep-24 Sep-34 Sep-35 11nc10 3.75% 1,250 3mE+130 XS2764264607 Feb-24 Aug-28 Aug-29 5.5nc4.5 3.87
Slide 45: ING Bank's covered bond programme…
ING Bank’s covered bond programme… ▪ ING Bank NV €30 bln Hard and Soft Bullet Covered Bonds programme Redemption type1) ▪ UCITS, CRR and ECBC Label compliant. Rated Aaa/AAA/AAA (Moody’s/S&P/Fitch) 2%1% Interest Only 3% Investment ▪ This programme is used for external issuance purposes. There is a se
Slide 46: …benefits from a continued strong Dutch housing market
…benefits from a continued strong Dutch housing market Dutch Purchasing Managers Index (PMI) showing initial signs of recovery Dutch unemployment rate (%) stable at a low level 70 15 60 10 50 5 40 30 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2013 2014 2015 2016 2017 2018 2019 202
Slide 47: 3Q2024 results overview
3Q2024 results overview In € mln Reported P&L Volatile items P&L excluding volatile items Net interest income 3,689 0 3,689 Net fee and commission income 1,009 0 1,008 Investment income 52 -51 103 Other income 1,160 224 936 Total income 5,909 173 5,736 Expenses excl. regulatory costs 2,816 23 2,793
Slide 48: Retail Banking countries contributing to strong returns
Retail Banking countries contributing to strong returns Retail Banking Total Netherlands Belgium1) Germany Spain Italy Australia Poland Romania Türkiye Scale (3Q2024) Customers (mln) 39.5 7.7 2.4 8.9 4.4 1.3 2.9 4.4 1.7 5.7 o.w. primary (mln) 15.8 4.8 1.1 2.9 1.6 0.5 1.1 2.2 0.9 0.6 o.w. mobile prim
Slide 49: Volatile income and expense items
Volatile income and expense items Volatile items (in € mln) 3Q2023 4Q2023 1Q2024 2Q2024 3Q2024 WB/FM – valuation adjustments 15 -52 16 19 8 Capital gains/losses 0 -25 7 4 -51 Hedge ineffectiveness1) 102 49 -60 39 170 Other items income2) -88 -16 4 5 46 Total volatile items – income 29 -44 -32 67 173
Slide 50: Other income mainly driven by stable client business and accounting asymmetry
Other income mainly driven by stable client business and accounting asymmetry Accounting asymmetry Other income (in € bln) Client business (in € mln) (in € mln) Other (in € mln) 458 471 442 423 266 2.8 444 423 432 0.2 413 421 2.2 63 63 83 67 79 334 334 353 24 74 80 29 31 286 300 209 192 55 40 27 28
Slide 51: Accounting asymmetry impacting net interest income
Accounting asymmetry impacting net interest income Treasury interest rate differential (in € mln) Wholesale Banking Financial Markets (in € mln) 383 356 376 24 375 23 19 17 21 197 474 515 515 273 242 233 231 408 193 216 28 39 70 50 52 -219 -172 -215 -214 -58 -249 -61 -160 -209 -192 3Q2023 4Q2023 1Q2
Slide 52: Granular customer deposit base
Granular customer deposit base Total customer deposits per segment (in € bln) ▪ Highly insured, granular and continuously growing customer 664 650 675 693 698 deposits represent a strong funding 39 42 base 61 41 58 26 62 37 68 69 116 118 118 120 121 ▪ ~70% of total deposits is from private individua
Slide 53: Hyperinflation accounting in Türkiye
Hyperinflation accounting in Türkiye Application of IAS 29 to consolidation of ING in Türkiye Impact on results (in € mln) ▪ We applied IAS 29 (‘Financial Reporting in Hyperinflationary 2Q2024 3Q2024 Economies’) to the consolidation of our subsidiary in Türkiye, Profit or loss effective as of 1 Janu
Slide 54: 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 ar
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