ING gets a capital boost from Dutch Government
ING Group will pump €2 billion ($3.9 billion) into the balance sheet of ING Insurance after the Dutch Government agreed to inject €10 billion ($19.5 billion) into the company.
The deal was announced yesterday and follows the Dutch Government’s announcement that it will make capital available to firms to boost confidence and stability in the Dutch financial system.
In return, ING will issue securities of €10 billion to the Government. ING Group will use the proceeds to increase shareholder equity in ING Bank by €5 billion ($9.7 billion) and pump €2 billion ($3.8 billion) into ING Insurance.
The remaining €3 billion ($5.8 billion) will be used to reduce the group’s debt-to-equity ratio from 15% to about 10%.
CEO Michel Tilmant says ING’s capital position is in line with previous targets and regulatory levels. But there is now international agreement that “in this market environment, capital requirements for financial institutions should be higher”.
The deal was announced yesterday and follows the Dutch Government’s announcement that it will make capital available to firms to boost confidence and stability in the Dutch financial system.
In return, ING will issue securities of €10 billion to the Government. ING Group will use the proceeds to increase shareholder equity in ING Bank by €5 billion ($9.7 billion) and pump €2 billion ($3.8 billion) into ING Insurance.
The remaining €3 billion ($5.8 billion) will be used to reduce the group’s debt-to-equity ratio from 15% to about 10%.
CEO Michel Tilmant says ING’s capital position is in line with previous targets and regulatory levels. But there is now international agreement that “in this market environment, capital requirements for financial institutions should be higher”.