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Fullyear2019resultsRalphHamers,CEOINGINGposts2019netresultof4,781mln;4Q2019netresultof880mlnAmsterdam6February2020Keypoints2INGposted2019netprofitof4,781mln,up1.
7%on2018Ourprimarycustomerbase,adriveroffuturevalue,increasedbymorethan830,000,to13.
3mlnin2019Werecordednetcorelendinggrowthof17.
2blnin2019,or2.
9%,primarilyinRetailBankingwhichgrewby16.
1blnwhilegrowthinWholesaleBankingsloweddownto1.
1blnResultsweresupportedbydisciplinedpricing,especiallyinmortgages,andhigherfeeincome,whichpartlycounteredmarginpressureoncustomerdeposits,higherKYCcostsandincreasingregulatoryexpensesRiskcostswerehigherin2019,butremainedbelowthethrough-the-cycleaverageReturnonequityfor2019was9.
4%CET1ratioin4Q2019wasrobustat14.
6%,with13.
2bln(or61bps)ofexpectedsupervisoryimpactonRWAalreadytakenin4Q2019WeexpecttoseefurthereffectsoncapitalfrombankingregulationandmodelreviewsinthecomingquartersOurdrivetobeinnovativeleadstoimpressiveresults,suchasYoltandKatanaCounteringfinancialandeconomiccrimeremainsapriorityandwemadefurtherprogressinimprovingourKYCanalyticalskillsandtheeffectivenessofournon-financialriskmanagementWeproposetopayafull-year2019cashdividendof2,689bln,or0.
69pershare,ofwhich0.
24wasalreadypaidinAugust2019Corelending2019netgrowth10.
411.
412.
513.
3>16.
52016201720182019Ambition2022Targettoreach>16.
5mlnprimarycustomers*by2022CommercialmomentumremainedstronginRetail3#1in6outof14retailcountries+16.
1blnRetailBanking29.
2%30.
5%32.
8%34.
3%Primaryasa%oftotalretailcustomers*Definition:activepaymentcustomerswithrecurringincomeandatleastoneextraactiveproductcategory+1.
1blnWholesaleBankingNetpromoterscores(NPS)4Q2019+23.
4blnCustomerdeposits2019netgrowth12%19%26%37%2016201720182019%ofmobile-onlyinchanneluseamongactivecustomerswhocontactus*%mobileintotalinteractionswithINGAnnualmobilenon-depositsalesper1,000activecustomersInRetailourmobileapproachistakingoff492846622016201720182019201620172018201952%73%82%63%CAGR+42%***CAGR+56%**CAGR+90%NumberofinteractionswithING(inbln)*Definition:Retailcustomerswhousedthechannelatleastonceinthelastquarter**CAGRfornumberofmobile-onlycustomersamongactivecustomerswhocontactus***CAGRfornumberofmobileinteractionwithING2.
53.
04.
53.
7AgrowingshareofRetailcustomersonlyinteractswithINGontheirmobiledevice,upfrom12%in2016to37%in2019Thenumberofinteractionsgrewby80%since2016,reaching4.
5blninteractionsin2019,withanincreasingshareofmobileof82%in2019,versus52%in2016Inmobileweareincreasinglysuccessfulatconvertingourinteractionsintosales,with7timeshighermobilesalesthanin2016FY2019results517.
517.
718.
118.
32016201720182019IncomegrowthsupportedbyhigherNIIandfeesUnderlyingincomegrew1.
2%in2019,largelydrivenbystrongerNIIintheRetailOtherChallengers&GrowthMarkets,WholesaleBankingandtheCorporateLine,aswellashighernetfeeandcommissionincomeinRetailBanking,especiallyinRetailC&GM.
ThisgrowthwaspartlyoffsetbyweakerNIIinRetailBeneluxandGermany,reflectinginterestmarginpressureoncustomerdepositsNetfeeandcommissionincomeincreasedby2.
3%in2019,mainlydrivenbyhigherfeesinRetailC&GMwhichwaspartlyoffsetbylowerdealactivityinWBInvestmentandotherincomeremainedstableat1.
4bln6Totalunderlyingincome(inbln)CAGR+5.
6%Netfeeandcommissionincome(inbln)Netinterestincomeexcl.
FM(inbln)CAGR+1.
6%CAGR+2.
3%8.
68.
99.
09.
30.
80.
90.
91.
02016201720182019Expenses(excl.
regulatorycosts)RegulatorycostsUnderlyingexpensesincreaseddrivenbyhigherKYC,staffandregulatorycostsUnderlyingoperatingexpenseshaveincreaseddespiteongoingcostdisciplineduetoacombinationoffactors:higherKYC-relatedexpenses,increasedstaffcosts,furtherincreasingregulatoryexpenses*andcontinuedinvestmentsinbusinessgrowthUnderlyingcost/incomeratiowashigherat56.
6%in2019(51.
0%excludingregulatorycosts)comparedto54.
8%in2018754.
2%55.
5%54.
8%56.
6%49.
3%50.
4%49.
5%51.
0%2016201720182019Cost/incomeratioCost/incomeratioexcl.
regulatorycostsCAGR+6.
5%CAGR+2.
7%Underlyingoperatingexpenses(inbln)Underlyingcost/incomeratio*Total2019regulatorycostsamountedto1,021mlnofwhich420mlnbanktaxes,362mlnDepositGuaranteeSchemes(DGS)and239mlnSingleResolutionFund(SRF)Riskcostsincreased,remainingbelowthrough-the-cycleaverageRiskcosts(inblnandbpsofaveragecustomerlending)181211182016201720182019RetailNetherlandsRetailBelgiumRetailCG&MWholesaleBankingBpsoveravgcustomerlending1.
00.
70.
71.
1Riskcostsincreasedto1,120mlnin2019,or18bpsofaveragecustomerlending,remainingbelowthethrough-the-cycleaverageof~25bpsTheincreasewasmainlydrivenbyanumberoflargeindividualfilesinWholesaleBankingaswellashigher,butstillrelativelylow,riskcostsinRetailNetherlandsafternetreleasesin2018andachangeinthehousepriceindexthatisusedforDutchmortgagesin3Q19BasedontheStage3ratioandthetotaloutstandingsearmarkedas'atrisk'*,thequalityoftheoverallloanbookimprovedin2019AfurtheranalysisofWholesaleBankingriskcostsfor2019doesnotindicateacorrelationingeographyorsectororiginatingtheriskcostsFurthermore,theunderlyingcausesofprovisioningforindividualWholesaleBankingfilesvary,includingoverhangfromtradewartensions,project-relatedlossesandshiftsincommoditypricesSeeAppendixsectionofpresentationforfurtherdetailsonassetqualityStage3ratio2.
1%1.
9%1.
5%1.
4%2016**2017201820198*OutstandingscategorisedasNon-PerformingLoan(NPL),SubstandardorWatchList(WL)**NPL-ratio10.
1%10.
2%11.
2%9.
4%20162017201820194,9764,9575,3894,7812016201720182019Underlyingnetresult*(inmln)Underlyingresultdown11.
3%in2019;ROEat9.
4%forFY2019Underlyingreturnonequity*INGrecordedunderlying2019netprofitof4,781mln,11.
3%lowerthanin2018,ashigherincomewasmorethanoffsetbyhigherriskcosts,increasedexpenses,includinghigherKYCandregulatoryexpenses,andahighereffectivetaxrateThe2019underlyingreturnonequity*was9.
4%comparedto11.
2%in20189*Includingthesettlementimpactof-775mlnrecordedin3Q18andthe90mlnnetresultfromInsuranceother,ING's2018netresultwas4,703mlnandING's2018totalreturnonaverageIFRS-EUequityexcluding'interimprofitnotincludedinCET1capital'was9.
8%685mlnincl.
-775mlnsettlementimpactand90mlnnetresultfromInsuranceotherINGGroupfinancialambitions10Actual2018Actual2019FinancialambitionsCapitalCET1ratio(%)14.
5%14.
6%~13.
5%*(BaselIV)Leverageratio(%)4.
4%4.
6%>4%ProfitabilityUnderlyingROE(%)**(IFRS-EUEquity)11.
2%9.
4%10-12%UnderlyingC/Iratio(%)**54.
8%56.
6%50-52%DividendDividend(pershare)0.
680.
69Progressivedividend*Impliesmanagementbuffer(incl.
Pillar2Guidance)of~170bpsoverprevailingfullyloadedCET1requirements(currently11.
83%,butisexpectedtoriseto11.
99%in2020duetophasing-inofcountercyclicalbuffers)**Basedon4-quarterrollingaverage,theINGGroupROEiscalculatedusingIFRS-EUshareholders'equityafterexcluding'interimprofitnotincludedinCET1capital'.
Asat31December2019,interimprofitnotincludedinCET1capitalamountsto1,754mln,setasideforfuturedividendpayments4Q2019results11WekeepinvestinginregulatorycomplianceWeannouncedaninvestmentinUS-basedregulatorytechnologycompanyAscent.
Thecompanyusesmachinelearningandnaturallanguageprocessingtohelpbuild,manageandautomateregulatorycomplianceFollowingtheannouncementtoinvestigatethepossibilitiestocooperateontransactionmonitoringwithfourDutchbanks,aprojectstructureandworkstreamshavebeensetupaspartofaproofofconcepttoenabledatasharingInBelgium,INGhasjoinedforceswithotherbanksandfintechIsabelGrouptomoreeffectivelyidentifysuspicioustransactions12WecontinueoureffortstocounterfinancialandeconomiccrimeContinuedfocusonknowyourcustomer(KYC)ThenumberofFTEworkinggloballyonknowyourcustomer(KYC)relatedactivitieshasincreasedto~4,000WemadefurtherprogressintheglobalrolloutofKYCtoolsthatenableustoonboardcustomersandmonitortheirtransactionsacrossourglobalnetworkinamoreeffectiveandconsistentwayWecompletedtheimplementationofoursystematicintegrityriskanalysisinallbusinesslinesandregions,ensuringuniformandconsistentKYCriskassessmentsacrossthebankInItaly,wecontinuetotakestepstoimproveprocessesandmanagementofKYCasrequiredbyBancad'ItaliaImportantmilestonesoninnovationachievedin4Q2019InPoland,INGisthefirstbankonthePolishmarkettointroduceaccountaggregationwithinMojeING(internetandmobile)Yolthasgrowntoover1millionregisteredusersandwontheBestPersonalFinanceAppawardattheInternationalPaymentsAwards2019.
IthasnowexpandedtoofferopenbankingforbusinessesInlinewithourstrategytocreateinnovativefintechsolutionsandthensupporttheminbecomingindependentcompanies,INGisspinningoutKatana,theadvancedanalyticsplatformthatsupportstradingportfoliomanagersinmakingfasterandsharperinvestmentdecisionsOurfocusonbuildinganinnovativeandsustainablebank13500mlnGreencoveredbond–1stGreencoveredbondforthecompanyWearerecognisedasaleaderinsustainabilityINGwasrecognisedasanA-listcompanyforleadershiponclimateactionforthefifthyearinarowbyCDP,theleadingglobalenvironmentaldisclosureplatformIn2019wereinforcedourcommitmenttohelpourcustomersreachtheirsustainabilitygoalsbyclosingmorethantwicetheamountofsustainablefinancedealscomparedtothepreviousyearIn4Q2019,INGhassupported13sustainabilityimprovementloans,plus3greenloansand12sustainablebonds1.
1blnsyndicatedGreenloan–LargestGreenloanissuedwithintheglobaltransportationsectorUnderlyingpre-taxresult(inmln)1,6921,5822,0051,9111,3374Q20181Q20192Q20193Q20194Q2019Incomereflectsdisciplineinlendingmarginsandfeegrowth144Q2019underlyingresultbeforetaxwas1,337mln,down21.
0%fromayearago,duetoslightlylowerincome,higherexpensesandhigherriskcostsUnderlyingincomewas62mlnlowercomparedto4Q2018asdisciplineinlendingmarginsandhigherfeeincomewereoffsetbyprimarilynegativevalueadjustmentsinFinancialMarkets,whiletheyear-agoquarterincludedanexceptional50mlnhigherprofitfromourstakeinTMBSequentially,thedecreaseinpre-taxresultwasdrivenbyacombinationoflowerincome,partlycausedby93mlndividendfromtheBankofBeijingreceivedinthepreviousquarter,aswellashigherexpenses,includingseasonallyhigherregulatoryexpenses,andincreasedriskcostsTotalunderlyingincome(inmln)4,5014,5764,6654,6264,4394Q20181Q20192Q20193Q20194Q20191561551521541571531541541541544Q20181Q20192Q20193Q20194Q2019NIMNIM(4-quarterrollingaverage)HigherNIMpartiallyexplainedbyFM(inbps)3,4593,3913,3913,4353,4784Q20181Q20192Q20193Q20194Q2019NIIimprovedonyear-agoandpreviousquarter;4-quarterrollingNIMat154bps15Netinterestincomeexcl.
FinancialMarkets(FM)(inmln)Netinterestincome,excludingFinancialMarkets,increased0.
5%comparedto4Q2018.
ImprovedNIIintheCorporateLineandsomeone-offsinWholesaleBanking,combinedwithhighervolumesincustomerlendingandimprovedmarginsonmortgages,morethanoffsetthenegativeimpactoflowerinterestmarginsoncustomerdepositsQuarter-on-quarter,NIIexcludingFMimproved1.
3%,mainlyduetohigherinterestresultsinTreasuryNIMwas157bps,upthreebasispointson3Q2019.
Thiswasmainlyattributabletohigher(volatile)interestresultsinFinancialMarkets,combinedwithhighernetinterestincomeinTreasuryandimprovedlendingmargins.
Thesefactorscompensatedforlowerinterestmarginsoncustomerdeposits4Q2019netcorelending16CustomerlendingINGGroup4Q2019(inbln)Corelendingbusinesses:2.
0blnOurnetcorelendinggrewby2.
0blnin4Q2019:RetailBankingincreasedby2.
6blnofwhich1.
9blnwasmortgagegrowthinmostcountriesand0.
7blnwasotherlendinggrowthWholesaleBankingreportedadecreaseof0.
6bln,mainlyinLending,reflectingprepaymentsonsomelargetermloans.
ThiswaspartlyoffsetbygrowthinTradeFinance,supportedbyhigheroilprices*C&GMisChallengers&GrowthMarkets;WBOtherincludesFinancialMarkets**FXimpactwas-1.
5blnandOther-0.
6bln249256262274256159159176180176295262290280303-14144Q20181Q20192Q20193Q20194Q2019RetailBeneluxRetailC&GMWholesaleBankingIntra-yearFMadjustment*747Netfeeandcommissionincome*(inmln)Furthergrowthoffeeincome;FMclientbusinessimprovedYoY17735704675711Feesincreasedby31mlnYoY,or4.
4%,drivenbyhigherfeesinRetailBankingandinTreasury&OtherinWholesaleBanking.
Sequentially,excludingtheFMadjustmentin3Q2019,feeincomewas2mlnhigher.
InWholesaleBankingfeesincreased,mainlyduetomoredealactivity.
ThiswaspartlyoffsetbylowerfeeincomeinRetailBanking,primarilyreflectingadjustmentsrelatingtopreviousquartersintheNetherlandsandBelgium**Excludingvaluationadjustments,FinancialMarket'sincomeroseby41mlnversus4Q2018drivenbyhigherincomefromRates,CreditTradingandGlobalCapitalMarkets.
Includingvaluationadjustments,totalincomedecreasedby29mln.
Sequentially,incomewas85mlnlower,causedbyhighernegativevaluationadjustmentsandseasonallylowerincomeinClientTradingUnderlyingincomeFinancialMarkets(inmln)+4.
4%180254255257221-4-58-72-25-744Q181Q192Q193Q194Q19Totalclientincomeexcl.
ValuationadjustmentsValuationadjustments*In3Q2019,anincreaseinfeesof14mlninWholesaleBankingwascausedbythereclassificationofcommissionspaidin2Q2019toOtherIncome**In4Q2019,causedbysomeaccountingadjustments,thereportedNetfeeandcommissionincomewasunderstatedby7mlnin4Q2019andoverstatedby5mlnin3Q20194939891266515971063031Q2Q3Q4Q20182019Underlyingcost/incomeratioHigherexpensesdrivenbyelevatedKYCcosts182,3032,2722,3542,3342,372266515971063034Q20181Q20192Q20193Q20194Q2019Expensesexcl.
regulatorycostsRegulatorycosts*Formalbuild-upphaseofDepositGuaranteeSchemes(DGS)andSingleResolutionFund(SRF)shouldbecompletedby2024Underlyingoperatingexpenses(inmln)Regulatorycosts*(inmln)Expensesexcl.
regulatorycostsroseby69mlnYoY,mainlyduetoapproximately75mlnofhigherexpensesrelatedtoKYC.
Higherexpensesforbusinessgrowth,salaryincreasesandITinvestmentswerelargelyoffsetbycostsavingsandsomeone-offs,includingaVATrefundintheCorporateLineSequentially,expensesexcl.
regulatorycostsincreasedby38mln,mainlydrivenby25mlnofhigherKYC-relatedcostsandhigherexpensesforbusinessgrowthandsalaryincreases,whereas3Q2019included40mlnoflegalprovisionsinRetailC&GM57.
1%60.
9%52.
5%52.
7%60.
3%54.
8%55.
0%55.
0%55.
8%56.
6%49.
5%49.
7%49.
7%50.
4%51.
0%4Q20181Q20192Q20193Q20194Q2019Cost/incomeratioCost/incomeratio(4-quarterrollingaverage)Cost/incomeratioexcl.
regulatorycosts(4-quarterrollingaverage)Stage3ratio1.
5%1.
5%1.
5%1.
5%*1.
4%1.
4%1.
4%1.
3%1.
3%*1.
2%1.
6%1.
6%1.
6%1.
6%1.
6%4Q20181Q20192Q20193Q20194Q2019INGWholesaleBankingRetailBankingRiskcosts(inmln)Riskcostsincreasedsequentially,assetqualityremainsstrong194Q2019riskcostswere428mln,or28bpsofaveragecustomerlending,slightlyabovethethrough-the-cycleaverageofapprox.
25bps.
TheBank'sStage3ratioimprovedto1.
4%,partlyduetowrite-offsofsomelargerfilesinWholesaleBankingRetailNetherlandsriskcostsfellto15mln,mainlyreflectinglowerriskcostsonmortgages,whichwereimpactedbyachangeinthehousepriceindexthatisusedin3Q19.
RetailBelgiumriskcostsincreasedto84mln,partlyduetohigherriskcostsonindividualmid-corporateclients.
RetailC&GMhadslightlyhigherriskcostsat75mln,asahighernetreleaseinGermanywasoffsetbyhigherriskcostsinTurkeyandPolandWBriskcostsincreasedto254mln,mainlyduetoindividualStage3provisionsbothonexistingandsomenewfiles,mainlyintheAmericas,BelgiumandAsia.
Underlyingcausesvaried,includingasizableprovisionforasuspectedexternalfraudcaseTheStage3%inWBremainslowat1.
2%andbasedontheexposureearmarkedas'atrisk'thequalityoftheloanbookimprovedcomparedtothepreviousquarterSeeAppendixsectionofthepresentationforfurtherdetailsonassetquality45112243154042164484107848073755071911162544Q20181Q20192Q20193Q20194Q2019RetailNetherlandsRetailBelgiumRetailC&GMWholesaleBanking242276428207209*Stage3credit-impairedasper30September2019adjusteddownwardsby548mlnINGGroupCET1ratiodevelopmentINGGroupCET1ratiostableat14.
6%20~13.
5%CET1ratioExpectedRWAimpacts2019SREPrequirementManagementbuffer(incl.
P2G)*838mlnwhichconsistsof4Q2019Groupnetprofitof880mlnminus42mlnsetasideforfuturedividendpayments**CurrentSREPrequirementis11.
83%,butisexpectedtoriseto11.
99%in2020duetophasing-inofcountercyclicalbuffers11.
8%**Theproforma4Q2019CET1ratiocameinat15.
2%.
However,asa13.
2blnRWAincreasereflectingpartoftheexpectedsupervisoryimpactonRWA(largelyTRIM)wastakenin4Q2019,theCET1ratiowasstableat14.
6%.
The13.
2blnRWAincreasemorethanoffsettheadditionofquarterlynetprofitandotherwiselowerCreditRWAduetopositiveriskmigrationandcurrencyimpacts.
OperationalRWAdecreasedby3.
0bln,whileMarketRWAwerestableInthecomingquarters,wewillseeadditionalRWAimpactcomingfrombankingregulationandmodelreviews(e.
g.
TRIM,DoD,othermacroprudentialadd-ons),althoughthemagnitudeofRWAimpactremainsuncertainWeremainwellpositionedtoachieveourCET1ratioambitionofaround13.
5%14.
6%-0.
6%15.
2%14.
6%Wrapup21Wrapup22INGposted2019netprofitof4,781mln,up1.
7%on2018Ourprimarycustomerbase,adriveroffuturevalue,increasedbymorethan830,000,to13.
3mlnin2019Werecordednetcorelendinggrowthof17.
2blnin2019,or2.
9%,primarilyinRetailBankingwhichgrewby16.
1blnwhilegrowthinWholesaleBankingsloweddownto1.
1blnResultsweresupportedbydisciplinedpricing,especiallyinmortgages,andhigherfeeincome,whichpartlycounteredmarginpressureoncustomerdeposits,higherKYCcostsandincreasingregulatoryexpensesRiskcostswerehigherin2019,butremainedbelowthethrough-the-cycleaverageReturnonequityfor2019was9.
4%CET1ratioin4Q2019wasrobustat14.
6%,with13.
2bln(or61bps)ofexpectedsupervisoryimpactonRWAalreadytakenin4Q2019WeexpecttoseefurthereffectsoncapitalfrombankingregulationandmodelreviewsinthecomingquartersOurdrivetobeinnovativeleadstoimpressiveresults,suchasYoltandKatanaCounteringfinancialandeconomiccrimeremainsapriorityandwemadefurtherprogressinimprovingourKYCanalyticalskillsandtheeffectivenessofournon-financialriskmanagementWeproposetopayafull-year2019cashdividendof2,689bln,or0.
69pershare,ofwhich0.
24wasalreadypaidinAugust2019Appendix23Volatileitemsandregulatorycosts(inmln)4Q181Q192Q193Q194Q19WB/FM–valuationadjustments-4-58-72-25-74Capitalgains/losses-1028215-8Hedgeineffectiveness-1078532-65Otheritems*2811979Totalvolatileitems49611312-147Regulatorycosts-266-515-97-106-303Pre-taxresultexcl.
volatileitemsandregulatorycosts(inmln)1,9542,0011,9892,0051,7874Q181Q192Q193Q194Q19Underlyingpre-taxresult(inmln)Significantimpactofvolatileitemson4Q2019pre-taxresult241,6921,5822,0051,9111,3374Q181Q192Q193Q194Q19Excludingvolatileitemsandregulatorycosts,4Q2019pre-taxresultwasdown8.
5%from4Q2018,ashigherincomecouldnotcompensateforhigherexpensesandanincreaseinriskcostsQuarter-on-quarter,theunderlyingresultbeforetaxexcludingvolatileitemsandregulatorycostswas10.
9%lower,duetoadeclineinincome(3Q2019includedthe93mlnBankofBeijingdividend)combinedwithhigherexpensesandanincreaseinriskcosts*Otheritemsin4Q2018includeda101mlngainonanequity-linkedbondtransactioninBelgium,a50mlnhighercontributionfromTMB(drivenbyone-offs)anda-123mlnlossontheintendedsaleofanItalianleaserun-offportfolio;1Q2019concernsa119mlnone-offgainonthereleaseofacurrencytranslationreserverelatedtosaleofING'sstakeinKotakMahindraBank;2Q2019concernstherecognitionofa79mlnreceivablerelatedtotheinsolvencyofafinancialinstitutionGroupCET1ratiodevelopmentduring4Q2019(amountsinblnand%)CapitalRWARatioChangeActuals30September201946.
7319.
714.
6%NetprofitincludedinCET1*0.
80.
26%Equitystakes0.
11.
3-0.
03%FX*-0.
3-1.
2-0.
03%RWA&Other**0.
26.
6-0.
24%Actuals31December201947.
6326.
414.
6%-0.
03%GroupCET1ratioat14.
6%andunderlyingROEat9.
4%25GroupunderlyingROEcalculationin4Q2019(inmln)Asof31December2019IFRS-EUshareholders'equity53,769deduct:InterimprofitnotincludedinCET1capital***1,754Adjustedshareholders'equity52,015Adjustedshareholders'equity(4Q-rollingaverage)50,861Underlyingnetresult(lastfourquarters)4,781UnderlyingROE(4Q-rollingaverage)9.
4%*4Q2019Groupnetprofit(880mln)ispartlyreservedfordividends(42mln)andremainderisincludedinGroupCET1capital(838mln)**RWAandOtherincludesthenegativeimpactfromalreadytakenpartofexpectedRWAinflation(-61bps),offsetbythepositiveimpactfromriskmigration(+19bps),OperationalRWA(+14bps),volumegrowth(+1bps)andotheritems(+5bps)***Asat31December2019,thiscomprisedinterimprofitsnotincludedinCET1capitalof1,754mln25%10%9%13%17%4%15%7%MortgagesNetherlandsOtherlendingNetherlandsMortgagesBelgiumOtherlendingBelgiumMortgagesGermanyOtherlendingGermanyMortgagesOtherC&GMOtherlendingOtherC&GMRetailBanking*INGGroup*WholesaleBanking*Note:percentagesforRetail(Netherlands)andWholesaleBankinghavechangedversus4Q2018asRealEstateFinanceportfoliorelatedtoDutchdomesticmidcorporateswastransferredtoRetailNetherlandsfromWholesaleBankingasper2Q2019*31December2019lendingandmoneymarketcreditoutstandings,includingguaranteesandlettersofcredit,butexcludingundrawncommittedexposures(off-balancesheetpositions)INGhasawell-diversifiedandwell-collateralisedloanbookwithastrongfocusonown-originatedmortgages;65%oftheportfolioisretail-based65%35%RetailBankingWholesaleBanking66%29%2%3%LendingDailyBanking&TradeFinanceFinancialMarketsTreasury&Other700bln454bln246blnWell-diversifiedlendingcreditoutstandingsbyactivity2614%12%17%25%6%2%3%21%JapanChina***HongKongSingaporeSouthKoreaTaiwanIndiaRestofAsiaLoanportfolioiswelldiversifiedacrossgeographies…LendingCreditO/SWholesaleBanking(4Q2019)*LendingCreditO/SWholesaleBankingAsia(4Q2019)*8%11%5%12%6%7%9%3%16%3%19%1%NLBeluxGermanyOtherChallengersGrowthMarketsUKEuropeannetwork(EEA**)Europeannetwork(non-EEA)NorthAmericaAmericas(excl.
NorthAmerica)AsiaAfrica10%16%8%9%13%16%22%6%RealEstate,Infra&ConstructionCommodities,Food&AgriTMT&HealthcareTransportation&LogisticsEnergyDiversifiedCorporates****FinancialInstitutions*****OtherGranularWholesaleBankinglendingcreditoutstandingsbygeographyandsector27Note:percentagesforWBNetherlandsarelowerversus4Q2018asRealEstateFinanceportfoliorelatedtoDutchdomesticmidcorporateswastransferredtoRetailNetherlandsfromWholesaleBankingasfrom2019*Dataisbasedoncountry/regionofresidence;LendingandmoneymarketcreditO/S,includingguaranteesandlettersofcreditbutexcludingundrawncommittedexposures(off-balancesheetpositions)**MembercountriesoftheEuropeanEconomicArea(EEA)***ExcludingourstakeinBankofBeijing(2.
0blnat31December2019)****Largecorporateclientsactiveacrossmultiplesectors*****IncludingFinancialsponsors246bln46bln…andsectorsLendingCreditO/SWholesaleBanking(4Q2019)*246blnBreakdownofquarterlyriskcostsWholesaleBanking2019pergeographyandsector281Q192Q193Q194Q19NLBeluxGermany/AustriaUKNordics+CHRestofEuropeUSALatamAsiaRE&Other1Q192Q193Q194Q19Non-BankFinancialInstitutionsTechnologyTelecomMediaUtilitiesRetailGeneralIndustriesRealEstateChemicals,Health&PharmaceuticalsTransportation&LogisticsAutomotiveServicesBuilders&ContractorsNaturalResourcesFood,Beverages&PersonalCareBreakdownofgeographywhichgeneratedriskcostsWB(inmln)BreakdownofsectorwhichgeneratedriskcostsWB(inmln)71116254917111625491DetailedStage3disclosureonselectedportfolios29*IncludesbothWBRealEstateFinanceportfolioandDutchdomesticmidcorporatesportfoliowhichwastransferredfromWholesaleBankingtoRetailNetherlandsin2Q2019**Ofwhich4.
4bln(or11%ofOil&Gasrelatedexposures)isrelatedtoreserve-basedlending(9%),offshoredrilling(1%)andoffshoreServices(1%)***Shipping&PortsincludesCoastalandInlandWaterFreightwhichisbookedwithinRetailNetherlands.
Excludingthisportfolio,Stage3ratiois2%****TurkeyincludesRetailBankingactivities(4.
5bln)Selectedportfolios(inmln)LendingcreditO/S4Q2019Stage3ratio4Q2019LendingcreditO/S3Q2019Stage3ratio3Q2019LendingcreditO/S4Q2018Stage3ratio4Q2018WholesaleBanking246,2231.
2%257,0821.
5%236,2481.
4%Lending163,0511.
4%171,5091.
7%153,2601.
5%DailyBanking&TradeFinance69,8210.
6%67,5941.
1%68,7080.
3%SelectedindustriesRealEstateFinance*34,7330.
5%34,0280.
9%33.
8001.
1%Oil&Gasrelated**39,0222.
3%37,8452.
3%38,0001.
6%Metals&Mining15,6751.
7%16,3232.
7%16,2492.
2%Shipping&Ports***14,8692.
2%15,2724.
2%14,6053.
7%SelectedcountriesTurkey****10,6164.
3%11,2914.
1%13,0112.
8%Russia5,0610.
0%5,5330.
1%5,7000.
2%Ukraine77812.
6%87118.
3%87621.
6%16%46%36%2%USDEURTRYOtherLendingCreditO/SbycurrencyOverviewTurkeyexposure30TotalexposureINGtoTurkey*(inmln)4Q20193Q2019ChangeLendingCreditO/SRetailBanking4,5374,817-5.
8%Residentialmortgages529537-1.
5%Consumerlending1,2031,225-1.
8%SME/Midcorp2,8043,054-8.
2%LendingCreditO/SWholesaleBanking6,0796,474-6.
1%TotalLendingCreditO/S*10,61611,291-6.
0%Stage3ratioandcoverageratio4Q20193Q2019Stage3ratio4.
3%4.
1%Coverageratio51%49%LendingCreditO/SbyremainingmaturityTRY**~1yearFX~2years*Databasedoncountryofresidence.
Lendingcreditoutstandings,includingguaranteesandlettersofcredit,butexcludingundrawncommittedexposures(off-balancesheetpositions)**Excludesresidentialmortgages,whichhaveanaverageremainingmaturityof~6yearsIntra-groupfundingreducedfrom2.
2blnatend-3Q2019to2.
1blnatend-4Q2019Reductionofoutstandingsin4Q2019ispartlyduetoTurkishliradepreciationINGonlyprovidesFXlendingtocorporatecustomerswithprovenFXrevenues;onlylimitedrolling-overofFXlendingfacilitiesECA-insuredlending(ExportCreditAgencies)isapprox.
1.
7bln;approx.
0.
6blnofSME/MidcorplendingbenefitsfromKGFcover(TurkishCreditGuaranteeFund)QualityoftheportfolioremainsrelativelystrongwithaStage3ratioof4.
3%Importantlegalinformation31INGGroup'sannualaccountsarepreparedinaccordancewithInternationalFinancialReportingStandardsasadoptedbytheEuropeanUnion('IFRS-EU').
Inpreparingthefinancialinformationinthisdocument,exceptasdescribedotherwise,thesameaccountingprinciplesareappliedasinthe2018INGGroupconsolidatedannualaccounts.
TheFinancialstatementsfor2019areinprogressandmaybesubjecttoadjustmentsfromsubsequentevents.
Allfiguresinthisdocumentareunaudited.
Smalldifferencesarepossibleinthetablesduetorounding.
Certainofthestatementscontainedhereinarenothistoricalfacts,including,withoutlimitation,certainstatementsmadeoffutureexpectationsandotherforward-lookingstatementsthatarebasedonmanagement'scurrentviewsandassumptionsandinvolveknownandunknownrisksanduncertaintiesthatcouldcauseactualresults,performanceoreventstodiffermateriallyfromthoseexpressedorimpliedinsuchstatements.
Actualresults,performanceoreventsmaydiffermateriallyfromthoseinsuchstatementsduetoanumberoffactors,including,withoutlimitation:(1)changesingeneraleconomicconditions,inparticulareconomicconditionsinING'scoremarkets,(2)changesinperformanceoffinancialmarkets,includingdevelopingmarkets,(3)potentialconsequencesoftheUnitedKingdomleavingtheEuropeanUnionorabreak-upoftheeuro,(4)changesinthefiscalpositionandthefutureeconomicperformanceoftheUSincludingpotentialconsequencesofadowngradeofthesovereigncreditratingoftheUSgovernment,(5)potentialconsequencesofaEuropeansovereigndebtcrisis,(6)changesintheavailabilityof,andcostsassociatedwith,sourcesofliquiditysuchasinterbankfunding,(7)changesinconditionsinthecreditandcapitalmarketsgenerally,includingchangesinborrowerandcounterpartycreditworthiness,(8)changesaffectinginterestratelevels,(9)inflationanddeflationinourprincipalmarkets,(10)changesaffectingcurrencyexchangerates,(11)changesininvestorandcustomerbehaviour,(12)changesingeneralcompetitivefactors,(13)changesinordiscontinuationof'benchmark'indices,(14)changesinlawsandregulationsandtheinterpretationandapplicationthereof,(15)changesincomplianceobligationsincluding,butnotlimitedto,thoseposedbytheimplementationofDAC6,(16)geopoliticalrisks,politicalinstabilitiesandpoliciesandactionsofgovernmentalandregulatoryauthorities,(17)changesinstandardsandinterpretationsunderInternationalFinancialReportingStandards(IFRS)andtheapplicationthereof,(18)conclusionswithregardtopurchaseaccountingassumptionsandmethodologies,andotherchangesinaccountingassumptionsandmethodologiesincludingchangesinvaluationofissuedsecuritiesandcreditmarketexposure,(19)changesinownershipthatcouldaffectthefutureavailabilitytousofnetoperatingloss,netcapitalandbuilt-inlosscarryforwards,(20)changesincreditratings,(21)theoutcomeofcurrentandfuturelegalandregulatoryproceedings,(22)operationalrisks,suchassystemdisruptionsorfailures,breachesofsecurity,cyber-attacks,humanerror,changesinoperationalpracticesorinadequatecontrolsincludinginrespectofthirdpartieswithwhichwedobusiness,(23)risksandchallengesrelatedtocybercrimeincludingtheeffectsofcyber-attacksandchangesinlegislationandregulationrelatedtocybersecurityanddataprivacy,(24)theinabilitytoprotectourintellectualpropertyandinfringementclaimsbythirdparties,(25)theinabilitytoretainkeypersonnel,(26)business,operational,regulatory,reputationandotherrisksinconnectionwithclimatechange,(27)ING'sabilitytoachieveitsstrategy,includingprojectedoperationalsynergiesandcost-savingprogrammesand(28)theotherrisksanduncertaintiesdetailedinthisannualreportofINGGroepN.
V.
(includingtheRiskFactorscontainedtherein)andING'smorerecentdisclosures,includingpressreleases,whichareavailableonwww.
ING.
com.
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Referencetosuchwebsitesismadeforinformationpurposesonly,andinformationfoundatsuchwebsitesisnotincorporatedbyreferenceintothisdocument.
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ManyofthosefactorsarebeyondING'scontrol.
AnyforwardlookingstatementsmadebyoronbehalfofINGspeakonlyasofthedatetheyaremade,andINGassumesnoobligationtopubliclyupdateorreviseanyforward-lookingstatements,whetherasaresultofnewinformationorforanyotherreason.
Thisdocumentdoesnotconstituteanoffertosell,orasolicitationofanoffertopurchase,anysecuritiesintheUnitedStatesoranyotherjurisdiction.