Capital management
Strong capital position and efficient capital allocation
ING seeks to maintain a strong capital position and to allocate capital efficiently. Together they help us to support growth, withstand financial stress and ultimately help to deliver shareholder value. In 2007, we enhanced our strong capital position thanks to strong profitability of the business and capital adequacy measures within capital management. ING employed excess capital to fund significant organic growth, for acquisitions, to buy back shares and pay attractive dividends to shareholders. On balance, ING was able to widen its spare leverage by a third, further securing the capital base and providing maximum financial flexibility to pursue strategic objectives.
Capital base: ING Groep N.V.
| in EUR million | Year-end 2007 |
Year-end 2006 |
|---|---|---|
| Shareholders’ equity (in parent) | 37,208 | 38,266 |
| + Group hybrid capital | 8,620 | 7,606 |
| + Group leverage (core debt) | 4,728 | 4,210 |
| Total capitalisation (Bank + Insurance) | 50,556 | 50,082 |
| –/– Revaluation reserves fixed income and other | 963 | 3,352 |
| –/– Group leverage (core debt) (d) | 4,728 | 4,210 |
| Adjusted equity (e) | 44,865 | 42,520 |
| Debt/equity ratio (d/(d+e)) | 9.53% | 9.01% |
| Economic Capital and Available Financial Resources |
||
| EC ING Group | 36,000 | 35,500 |
| AFR ING Group | 49,715 | 48,774 |
| AFR/EC ratio | 138% | 137% |
Capital base: ING Verzekeringen N.V. (Insurance)
| in EUR million | Year-end 2007 |
Year-end 2006 |
|---|---|---|
| Adjusted equity (e) | 27,036 | 29,123 |
| Core debt (d) | 4,267 | 4,802 |
| Debt/equity ratio (d/(d+e)) | 13.63% | 14.15% |
| Available regulatory capital (a) | 22,965 | 25,505 |
| E.U. required regulatory capital (b) | 9,405 | 9,296 |
| Capital coverage ratio (a/b) | 244% | 274% |
| Buffer for equities and real estate (c) | 6,428 | 7,101 |
| Internal capital coverage ratio (a/b+c) | 145% | 156% |
| Economic Capital and Available Financial Resources |
||
| EC ING Insurance | 23,199 | 22,410 |
| AFR ING Insurance | 22,710 | 27,200 |
Capital base: ING Bank N.V.
| in EUR million | Year-end 2007 |
Year-end 2006 |
|---|---|---|
| Core Tier-1 | 23,374 | 20,058 |
| Hybrid Tier-1 | 6,397 | 5,726 |
| Total Tier-1 capital | 29,772 | 25,784 |
| Other capital | 11,792 | 11,445 |
| BIS capital | 41,564 | 37,229 |
| Risk-weighted assets | 402,727 | 337,926 |
| Tier-1 ratio | 7.39% | 7.63% |
| BIS ratio | 10.32% | 11.02% |
| Economic Capital and Available Financial Resources |
||
| EC ING Bank | 17,927 | 15,876 |
| AFR ING Bank | 31,733 | 25,784 |
