(6,04 EUR, -2,50%) at the occasion of its Investor Day sent out a press release in which it sums the priorities for 2012 and 2013: repayment Dutch State, completion EC Restructuring and fulfilment of Basel III requirements while achieving a minimum core Tier 1 ratio of 10% at the end of this period. Long term ambitions for the period ranging up to 2015: superior customer centricity, balance sheet optimisation and operational excellence resulting in ROE of 10% to 13% under Basel III. Bank thus aims to remain a strong European bank with potential to grow, without growing the balance sheet.
CEO Jan Hommen says is relatively well positioned toadapt to the today’s challenges in the banking industry. The 2011 divestments and liability management exercise that has just been completed have strengthened ING’s capital position. plans to increase focus on customer centricity, work towards operational excellence and optimise the balance sheet.
up until 2014 will focus on repaying the remaining core Tier 1 securities that are owed to the Dutch State, completing the EC Restructuring and fulfilling increasing capital requirements known as Basel III. But given the ongoing crisis in the eurozone and increasing regulatory capital requirements, takes a cautious approach and pays special attention to liquidity, funding and capital. The bank expects difficult and volatile market circumstances from 2011 to continue in the near future. From 2013 onwards, it aims to maintain a minimum core Tier 1 ratio of 10% and intends to resume dividend payments on common shares when all remaining core Tier 1 securities have been repaid and Basel III requirements have been met.
Converging the retail banking business models towards operational excellence should offset part of the increasing regulatory costs and bank taxes. Bank is shooting for a c/I ratio of 50-53% by 2015. Procurement initiatives are expected to save € 300m per year by 2015 but further structural efficiency improvements and IT investments will be needed to reach ING's long term cost-income ratio target of 50%. Optimising the balance sheet more efficiently will help to maximise returns and to offset higher capital requirements, without increasing the balance sheet.
By 2015, customer centricity, operational excellence and balance sheet optimisation should enable to achieve a ROE under Basel III rules of 10-13%, while maintaining a minimum coreTier 1 ratio of 10% and a cost/income ratio of 50-53%. The negative impact of Basel III by end-2013 on ING's core Tier 1 ratio is expected to be a manageable 80 basis points.After reducing Southern European sovereign debt in 4Q2011 by approx. € 1.2bn, (around € 4bn in 2011), the total remaining positions in Southern European sovereign debt hover around € 2bn.
The press release contains no new items, but merely sums up ING's targets. The more important news items have already been released yesterday.