ING Group said it will sell all of its insurance and investment management businesses as the biggest Dutch financial services company moves to separate its banking and insurance operations.
The owner of ING Investment Management (INGIM) and ING Direct in Australia said the divestments will be executed over the next four years through initial public offerings, sales or a combination thereof.
The move comes after the Amsterdam-headquartered company received a $16.25 billion (10 billion euro) capital injection from the Dutch state amid the global financial crisis.
"We are announcing a comprehensive set of actions that, taken together, provide a clear plan for resolving the uncertainty created by the financial crisis and will launch a new era for ING," ING chief executive Jan Hommen said yesterday.
"A little over one year ago, ING began to experience the direct impact of the financial crisis, resulting in two instances of government support to strengthen our capital position and to mitigate risk.
"Over the last six months, we have worked tirelessly - both inside ING and with the Dutch government and the European Commission - to devise a plan that will enable us to pay back the Dutch state, address the EC's requirements for viability and fair competition, and return our focus to the business and what matters most to our customers."
Splitting the company is not a decision ING took lightly, Hommen said.
In conjunction with the restructuring plan, ING plans to launch a $12.20 billion (7.5 billion euro) rights issue to repay half of the bailout funds it was given by the Dutch state.
ING also said it has reached an agreement with the Dutch state to alter the repayment terms of the Core Tier 1 securities issued in November 2008 (and held by the Dutch government), in order to facilitate early repayment.
In September, ING agreed to sell its 51 per cent stakes in ING Australia and ING New Zealand to ANZ for $1.76 billion.
