Rescued Dutch bancassurer ING will sell its remaining insurance and investment management operations to focus on banking, mainly in Europe, by the end of 2013.

The new structure, along with a €7.5 billion ($12.3 billion) rights issue is aimed at halving its lifeline from the Netherlands Government and thereby yielding to European Commission requirements on viability and fair competition.

In September ING raised $1.87 billion by selling its 51% stake in its Australasian life insurance joint venture with ANZ Bank.

ING says the global financial crisis has diminished the benefits of combining banking and insurance in one company, something it used to advocate strongly.

“The combination provided us with advantages of scale, capital efficiency and earnings stability through a diversified portfolio of businesses,” the company said in a statement.

Now it says the widespread demand for greater simplicity, reliability and transparency has made a split the “optimal course of action”.

[Also see ANALYSIS].