Ing Groep N.v. · EURONEXT:INGA
Ing Groep — ING Bank — Debt Investor Presentation (November 2015)
33 slides from Ing Groep's debt investor presentation, November 2015
Slide 1: ING Bank Green Bond Presentation
ING Bank Green Bond Presentation November 2015
Slide 2: Disclaimer
Disclaimer This document has been prepared by ING Bank N.V. (‘ING’) solely for use in investor meetings. This document is confidential and is not to be reproduced by any person, nor be distributed to any person other than its original recipient. Each recipient shall return the document at the end of
Slide 3: Contents
Contents 1.ING Bank Credit Update 3 2.ING Bank Green Bond 10 Appendix 20 ING Bank | Green Bond Presentation | November 2015 2
Slide 4: 1. ING Bank Credit Update
1. ING Bank Credit Update
Slide 5: Key points
Key points • Strong capital position: ING well placed to absorb regulatory impacts and to deliver attractive capital return • Fully-loaded CET 1 ratios: ING Bank stable at 11.3%; ING Group unchanged at 12.3%, despite EUR 2.2 bln profit not included in capital • Further sell-down of shares in NN Grou
Slide 6: Our consistent customer focus led to strong results in 9M15
Our consistent customer focus led to strong results in 9M15… Underlying net result Banking rose 18.1% from 9M14 (in EUR mln) …resulting in underlying RoE of 11.6% in 9M15 CAGR +4.1% +18.1% 11.6% 3,424 3,397 10-13% 3,036 3,155 9.9% 2,876 9.0% 9.0% 2,450 7.0% 10% 2011 2012 2013 2014 9M14 9M15 2011 201
Slide 7: Supported by healthy income growth and lower risk costs
…supported by healthy income growth and lower risk costs Underlying income excl. CVA/DVA Net interest result excl. FM Risk costs (in EUR bln) (in EUR bln) (in EUR bln and bps of RWA) CAGR +3.6% 15.2 15.6 +4.5% 15.0 CAGR +0.8% 14.0 12.3 11.7 11.4 11.3 11.6 +5.7% 11.0 8.6 9.1 83 74 55 55 48 46 2.1 2.3
Slide 8: On track to deliver on our Ambition 2017
On track to deliver on our Ambition 2017 Ambition ING Bank 2014 9M15 2017 Guidance • We will maintain a comfortable buffer above the CET1 (CRD IV) 11.4% 11.3% >10% minimum 10% to absorb regulatory changes and potential volatility Leverage* 4.1% 4.3% ~4% • Aim to reach 50-53% cost/income ratio in 201
Slide 9: Risk costs down to EUR 261 mln or 34 bps of RWA
Risk costs down to EUR 261 mln or 34 bps of RWA and NPL ratio down to 2.6% Risk costs (in EUR mln) NPL ratio (in %) 2Q15 3Q15 432 Retail Netherlands 3.4 3.2 400 353 Retail Belgium 3.3 3.3 322 173 152 Retail Challengers & Growth 35 111 261 1.4 1.3 Markets 63 59 Commercial Banking 3.1 2.9 44 65 62 97
Slide 10: Risk costs and NPL ratio Retail Netherlands
Risk costs and NPL ratio Retail Netherlands continued their downward trend, reflecting the economic recovery Risk costs Retail NL have come down from the peak in 2013 Risk costs decreased sharply to EUR 82 mln or 55 bps of (in EUR mln) RWA in 3Q15, driven by lower risk costs in all segments 154 133
Slide 11: 2. ING Bank Green Bond
2. ING Bank Green Bond
Slide 12: ING strongly committed to sustainability
ING strongly committed to sustainability “We use sustainability criteria in our capital allocation choices to help stimulate the transition to a sustainable economy.” Ralph Hamers – Chief Executive Officer ING Group The ING sustainability cycle Sustainability is deeply …and translated into ING’s Sel
Slide 13: ING strongly committed to sustainability (cont'd)
ING strongly committed to sustainability (cont’d) Our long track record in sustainability Our performance recognised by experts and public First Creation of Launch of Start carbon Start of Sustainability Groenbank Sustainability offsetting Sustainable ING is ranked in the top 3% of more than 2,000 r
Slide 14: Financing sustainable transitions
Financing sustainable transitions A comprehensive strategy empowering the shift to a green economy Sustainable Transitions Financed – our inclusive approach • Sustainable Finance covers all business areas of Commercial Banking • ING recognises its role in creating a healthy • The identification of s
Slide 15: ING Bank's Green Bond issuance rationale
ING Bank’s Green Bond issuance rationale Sustainable performance accelerated through capital markets The Green Bond Framework has been Our inclusive and integrated sustainability developed to enable increased acceleration of approach towards Sustainable Transitions Sustainable Transitions Financed •
Slide 16: Key aspects of ING Bank's Green Bond
Key aspects of ING Bank’s Green Bond Funding our Sustainable Performance 1 Use of proceeds 3 Management of proceeds • (Re)finance loans to projects in six eligible categories • Minimum of 20% of initial proceeds will be allocated to fund new • Loans are originated and held by ING’s Commercial Bankin
Slide 17: Identification of eligible projects
Identification of eligible projects ING Bank Green Bond will (re)finance projects supporting the transition to a sustainable economy These projects are identified following the application of sustainability score card to every structured – and project financing (see table below) Identification and s
Slide 18: Examples of eligible projects
Examples of eligible projects • ING participated in a € 534mn loan to Canary • ING acted as Mandated Lead Arranger to its first • ING co-structured the circa €320m long term debt Wharf Group to acquire a landmark building in the offshore wind project financing in Belgium package of the wind farm Wes
Slide 19: Qualifying assets
Qualifying assets €920m of eligible projects under the Green Bond Framework Expected Green Bond portfolio sector distribution* Green Bond portfolio Committed financing in €m Renewable energy 8% 41% Onshore wind 68 Renewable Energy 16% Offshore wind 195 Green Buildings Solar 115 Public Transport Tota
Slide 20: Highlights from oekom's SPO
Highlights from oekom’s SPO Sustainability quality of the Green Bond issued by ING Bank NV 1 The Green Bond’s formal concept, defined processes and (announced) disclosures are aligned with the Green Bond Principles 2 The overall sustainability quality of the bond and the sustainability performance o
Slide 21: Appendix
Appendix
Slide 22: Capital and funding
Capital and funding
Slide 23: We have generated a significant amount of capital
We have generated a significant amount of capital Net profit (in EUR bln) A strong profitability track record • ING Bank reported only one small loss in history 4.4 4.5 3.6 3.7 • Average annual profitability of 3.1 3.0 EUR 2.7 billion in period 2007- 2.6 2014, including during the years of financial
Slide 24: Capital position remains strong
Capital position remains strong ING Bank fully-loaded CET 1 ratio stable at 11.3% ING Group pro-forma fully-loaded CET1 ratio at 12.8% (in %) excl. net profit of EUR 2.2 bln not included in capital (in %) 0.4% -0.3% 12.8% -0.1% 0.3% -0.3% 11.3% 11.3% 12.3% 12.3% 2Q15 Net profit Revaluation RWA** 3Q1
Slide 25: ING Bank has a sizeable capital buffer
ING Bank has a sizeable capital buffer Total capital (in EUR bln)* ING Bank total Risk Weighted Assets (in EUR bln) 332 330 310 16.5% 55.4 283 296 16.5% 11 13.5% 14.3% 16.5% 8.9 8.9 42 8.5 8.3 9.5 7.4 10.7 5.7 7.4 6.9 5.1 8.1 257 33.1 33.7 35.0 39.0 26.0 31.8 2009 2011 2013 2014 3Q2015 3Q2015 2009 2
Slide 26: ING has flexibility to comply with expected TLAC requirements
ING has flexibility to comply with expected TLAC requirements* Possible TLAC requirements The Financial Stability (3Q15, fully loaded, in %) Board’s TLAC proposals • TLAC proposals not yet CET1 Management Buffer final. Finalisation expected Minimum total in November 2015 CET1 SRB: 3.0% requirement A
Slide 27: Deposits are the primary source of funding
Deposits are the primary source of funding Attractive funding profile Total liabilities (30 September 2015, in %) • 59% of the balance sheet is funded by customer deposits • 85% of customer deposits is retail based 15% 5% • Attractive Loan-to-Deposit ratio of 1.03 9% as per 30 September 2015 12% Cus
Slide 28: Long-term debt issuance has increased over time
Long-term debt issuance has increased over time Long-term funding increased (in EUR bln) Short-term professional funding reduced (in EUR bln) 65 52 79 86 86 85 44 37 84 37 35 72 21 30 42 18 15 17 16 27 2009 2011 2013 2014 3Q2015 2009 2011 2013 2014 3Q2015 Subordinated loans Long-term debt Interbank
Slide 29: ING Bank has modest long-term funding needs
ING Bank has modest long-term funding needs Maturity ladder outstanding long-term debt (in EUR million) Issued Maturing 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 2013 2014 2015 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 >2025 remaining ING Bank senior debt ING Bank covered bond I
Slide 30: ING Bank has a sizeable liquidity buffer
ING Bank has a sizeable liquidity buffer ING Bank liquidity buffer 30 September 2015 (in EUR bln) 81 191 89 21 Cash and holdings at central banks Securities issued or guaranteed by Liquid assets eligible at central Total sovereigns, central banks and banks (not included in above) multilateral develo
Slide 31: Russia and Ukraine loan portfolio
Russia and Ukraine loan portfolio
Slide 32: The quality of our Russian portfolio remains strong
The quality of our Russian portfolio remains strong Exposure ING Bank to Russia (in EUR mln) Lending outstanding per currency Change Change 10% 3Q15 3Q14 3Q-3Q 2Q15 3Q-2Q 61% Total Lending Credit O/S 5,696 6,851 -1,155 5,842 -146 29% Other* 487 947 -460 691 -204 USD Total outstanding 6,183 7,798 -1,
Slide 33: The quality of our Ukraine portfolio continues to be under pressure, but manageable
The quality of our Ukraine portfolio continues to be under pressure, but manageable Exposure ING Bank to Ukraine (in EUR mln) Lending outstanding per currency Change Change 11% 3Q15 3Q14 3Q-3Q 2Q15 3Q-2Q 73% Total Lending Credit O/S 1,168 1,289 -121 1,252 -84 16% Other* 0 20 -20 5 -5 USD Total outst
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