ING Groep(ING) - 2025 Q2 - Quarterly Report

FORM 6-K Presentation of Information Accounting Principles and Reporting Standards The company reports to the SEC under IFRS-IASB, differing from its primary IFRS-EU statements mainly due to the IAS 39 carve-out for hedge accounting - ING prepares SEC filings under IFRS-IASB, but its primary financial statements use IFRS-EU, with differences mainly in IAS 39 hedge accounting for interest rate risk[8][11][13] Cautionary Statement with respect to Forward-looking Statements Forward-Looking Statements and Risk Factors The report contains forward-looking statements subject to risks from economic conditions, regulatory changes, and geopolitical events - Forward-looking statements are subject to material risks including economic conditions, interest rates, financial market performance, regulatory changes, geopolitical risks, and operational/IT risks[16][18][19] - ESG-related materiality in this document differs from SEC reporting definitions, and there is no globally recognized standard for "green" or "sustainable" activities[17][20] Interim Report Condensed Consolidated Results Net results declined in 1H2025 amid stable income, as rising operating expenses and loan loss provisions offset strong lending and deposit growth Condensed Consolidated Results (6M2025 vs 6M2024) | Metric (in EUR million) | 6M2025 | 6M2024 | Growth % | | :---------------------- | :----- | :----- | :------- | | Net result IFRS-EU | 3,130 | 3,358 | -7 % | | Net result IFRS-IASB | 3,915 | 4,456 | -12 % | | Net interest income | 7,159 | 7,655 | -6 % | | Net fee and commission income | 2,216 | 1,998 | 11 % | | Total income | 11,339 | 11,300 | 0 % | | Operating expenses | 6,234 | 5,880 | 6 % | | Addition to loan loss provisions | 612 | 559 | 9 % | | Result before tax | 4,493 | 4,861 | -8 % | | Net core lending growth (in EUR billion) | 22.2 | 12.0 | | | Net core deposits growth (in EUR billion) | 28.8 | 28.2 | | | Risk costs in bps of average customer lending | 18 | 17 | | - The IFRS-IASB net result adjustment for the EU 'IAS 39 carve-out' was EUR 786 million (6M2025) compared to EUR 1,099 million (6M2024), mainly due to positive fair value changes on derivatives[27] - Net core lending growth was EUR 22.2 billion, driven by residential mortgages, while net core deposits grew by EUR 28.8 billion, led by Retail deposits[30][31] Retail Banking The segment saw strong customer growth and higher fee income, though net interest income declined and loan loss provisions increased Retail Banking Key Financial Metrics (6M2025 vs 6M2024) | Metric (in EUR million) | 6M2025 | 6M2024 | Growth % | | :---------------------- | :----- | :----- | :------- | | Commercial net interest income | 5,595 | 5,784 | -3 % | | Net fee and commission income | 1,522 | 1,325 | 15 % | | Total income | 7,623 | 7,620 | 0 % | | Operating expenses | 4,093 | 4,019 | 2 % | | Addition to loan loss provisions | 385 | 264 | 46 % | | Result before taxation | 3,145 | 3,338 | -6 % | | Net core lending growth (in EUR billion) | 19.9 | 12.4 | | | Net core deposits growth (in EUR billion) | 25.9 | 18.2 | | | Risk costs in bps of average customer lending | 15 | 11 | | - Retail Banking's mobile primary customers increased by 1.1 million year-on-year[47] - Net core lending growth was EUR 19.9 billion, with EUR 13.2 billion from mortgages, and net core deposits growth was EUR 25.9 billion, significantly driven by Germany[48][49] - Net fee and commission income increased 15%, primarily due to investment products and daily banking fees[50] Retail Netherlands Retail Netherlands Key Financial Metrics (6M2025 vs 6M2024) | Metric (in EUR million) | 6M2025 | 6M2024 | Growth % | | :---------------------- | :----- | :----- | :------- | | Commercial net interest income | 1,803 | 1,803 | 0 % | | Net fee and commission income | 540 | 513 | 5 % | | Total income | 2,451 | 2,423 | 1 % | | Operating expenses | 981 | 1,023 | -4 % | | Addition to loan loss provisions | 72 | -43 | | | Result before taxation | 1,398 | 1,443 | -3 % | | Net core lending growth (in EUR billion) | 8.5 | 3.4 | | | Net core deposits growth (in EUR billion) | 5.2 | 1.4 | | | Risk costs in bps of average customer lending | 9 | -6 | | - Regulatory costs declined due to the Netherlands' deposit guarantee fund reaching its target level[57] Retail Belgium Retail Belgium Key Financial Metrics (6M2025 vs 6M2024) | Metric (in EUR million) | 6M2025 | 6M2024 | Growth % | | :---------------------- | :----- | :----- | :------- | | Commercial net interest income | 831 | 948 | -12 % | | Net fee and commission income | 339 | 306 | 11 % | | Total income | 1,298 | 1,402 | -7 % | | Operating expenses | 995 | 980 | 2 % | | Addition to loan loss provisions | 76 | 65 | 17 % | | Result before taxation | 226 | 357 | -37 % | | Net core lending growth (in EUR billion) | 1.7 | 3.4 | | | Net core deposits growth (in EUR billion) | 0.7 | 2.4 | | | Risk costs in bps of average customer lending | 15 | 14 | | - Commercial NII declined 12% due to reduced liability margins[61] Retail Germany Retail Germany Key Financial Metrics (6M2025 vs 6M2024) | Metric (in EUR million) | 6M2025 | 6M2024 | Growth % | | :---------------------- | :----- | :----- | :------- | | Commercial net interest income | 1,115 | 1,242 | -10 % | | Net fee and commission income | 287 | 212 | 35 % | | Total income | 1,425 | 1,498 | -5 % | | Operating expenses | 680 | 628 | 8 % | | Addition to loan loss provisions | 77 | 65 | 18 % | | Result before taxation | 667 | 805 | -17 % | | Net core lending growth (in EUR billion) | 3.2 | 1.7 | | | Net core deposits growth (in EUR billion) | 14.2 | 9.8 | | | Risk costs in bps of average customer lending | 14 | 13 | | - Customer deposits rose by EUR 14.2 billion, reflecting a strong inflow from a promotional savings campaign[67] - Fee income increased 35% due to higher investment product trades, customer growth, and daily banking fees[69] Retail Other Retail Other Key Financial Metrics (6M2025 vs 6M2024) | Metric (in EUR million) | 6M2025 | 6M2024 | Growth % | | :---------------------- | :----- | :----- | :------- | | Commercial net interest income | 1,847 | 1,790 | 3 % | | Net fee and commission income | 356 | 293 | 22 % | | Total income | 2,449 | 2,297 | 7 % | | Operating expenses | 1,436 | 1,388 | 3 % | | Addition to loan loss provisions | 159 | 176 | -10 % | | Result before taxation | 854 | 733 | 17 % | | Net core lending growth (in EUR billion) | 6.4 | 3.9 | | | Net core deposits growth (in EUR billion) | 5.7 | 4.6 | | | Risk costs in bps of average customer lending | 27 | 32 | | - Commercial NII rose 3.2% due to higher lending income from expanded volumes at stable margins[74] - Net fee and commission income increased 22%, driven by investment products, daily banking, and insurance[75] Wholesale Banking Net results declined significantly due to lower total income from margin compression and a 14% rise in operating expenses Wholesale Banking Key Financial Metrics (6M2025 vs 6M2024) | Metric (in EUR million) | 6M2025 | 6M2024 | Growth % | | :---------------------- | :----- | :----- | :------- | | Commercial net interest income | 1,971 | 2,030 | -3 % | | Net fee and commission income | 696 | 676 | 3 % | | Total income | 3,452 | 3,580 | -4 % | | Operating expenses | 1,901 | 1,662 | 14 % | | Addition to loan loss provisions | 227 | 295 | -23 % | | Result before taxation | 1,324 | 1,623 | -18 % | | Net result IFRS-EU | 962 | 1,194 | -19 % | | Net result IFRS-IASB | 1,748 | 2,293 | -24 % | | Net core lending growth (in EUR billion) | 2.3 | -0.5 | | | Net core deposits growth (in EUR billion) | 2.9 | 10.0 | | | Risk costs in bps of average customer lending | 24 | 31 | | - Total income declined 3.6%, with strong Financial Markets performance offset by margin compression in Payments & Cash Management[82] - Operating expenses increased 14%, including EUR 90 million for restructuring provisions (EUR 85 million for workforce redundancies)[79][89] Risk Management Business Environment and Geopolitical Risks Elevated geopolitical risks from global conflicts and trade tensions created market volatility and operational uncertainty in 1H2025 - Geopolitical risks remained elevated in 1H2025, causing market volatility and operational uncertainty due to global conflicts, trade tensions, and political fragmentation[96][99][100] - ING's remaining credit exposure to Russian counterparties booked outside Russia decreased to €0.7 billion, with the sale of its Russian bank expected to close in Q3 2025[103][104] - ING's credit exposure in Ukraine was approximately €470 million, largely guaranteed by international parents or strong collateral[106] Credit Risk The loan portfolio quality remains strong, with ECL models incorporating climate risk adjustments and updated macroeconomic scenarios - ING applies the IFRS 9 ECL model, incorporating climate risk factors via a management adjustment for high greenhouse gas-emitting sectors[110][112] Portfolio Quality by IFRS 9 Stage (30 June 2025) | IFRS 9 Stage | % of Total Gross Carrying Amounts | | :----------- | :------------------------------ | | Stage 1 | 91.7 % | | Stage 2 | 7.1 % | | Stage 3 | 1.2 % | - Stage 3 gross carrying amount decreased by €0.8 billion to €12.9 billion, while Stage 2 decreased by €2.3 billion to €77.6 billion[121] Management Adjustments to ECL Models (in EUR million) | Adjustment Type | 30 June 2025 | 31 December 2024 | | :--------------------------------------------- | :----------- | :--------------- | | Commercial Real Estate/Inflation & Interest Rate | 32 | 50 | | Economic sector / portfolio based adjustments | 20 | 38 | | Mortgage portfolio adjustments | 112 | 112 | | Climate transition risk | 44 | 29 | | Other Post Model Adjustments | 29 | -27 | | Total management adjustments | 236 | 203 | - The June 2025 macroeconomic forecast for global GDP growth deteriorated slightly to 2.0% for 2025 and 2.1% for 2026 due to geopolitical tensions[137] Other Risks and Uncertainties Business performance is exposed to market volatility, while Poland's WIBOR benchmark reform is progressing toward a 2027 replacement - ING's business is exposed to volatility in economic, business, liquidity, funding, and capital markets, with factors like geopolitical events, interest rates, and climate change posing risks[171][172] - The WIBOR benchmark in Poland is being replaced by the new POLSTR index, with full replacement expected by December 31, 2027[175] Condensed Consolidated Interim Financial Statements Condensed Consolidated Statement of Financial Position Total assets grew to EUR 1,091 billion as of June 30, 2025, driven by increases in both customer loans and deposits Condensed Consolidated Statement of Financial Position (in EUR million) | Item | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Assets | | | | Cash and balances with central banks | 75,565 | 70,353 | | Loans and advances to banks | 50,080 | 21,770 | | Financial assets at fair value through profit or loss | 152,486 | 137,580 | | Loans and advances to customers | 693,285 | 683,611 | | Total assets | 1,090,974 | 1,023,856 | | Liabilities | | | | Customer deposits | 738,028 | 691,661 | | Debt securities in issue | 151,016 | 142,367 | | Total liabilities | 1,037,653 | 970,158 | | Equity | | | | Total equity | 53,321 | 53,698 | | Total liabilities and equity | 1,090,974 | 1,023,856 | Condensed Consolidated Statement of Profit or Loss Net result for 1H2025 was EUR 4,042 million, a decrease from the prior year due to lower total income and higher expenses Condensed Consolidated Statement of Profit or Loss (1 Jan to 30 June, in EUR million) | Item | 2025 | 2024 | | :--------------------------------------- | :------ | :------ | | Total interest income | 25,842 | 29,929 | | Total interest expense | -18,552 | -22,166 | | Net interest income | 7,290 | 7,762 | | Net fee and commission income | 2,216 | 1,998 | | Total income | 12,404 | 12,812 | | Total expenses | 6,846 | 6,439 | | Result before tax | 5,558 | 6,373 | | Net result | 4,042 | 4,575 | | Net result attributable to shareholders of the parent | 3,915 | 4,456 | | Basic earnings per ordinary share (in EUR) | 1.29 | 1.35 | | Diluted earnings per ordinary share (in EUR) | 1.29 | 1.35 | Condensed Consolidated Statement of Comprehensive Income Total comprehensive income for 1H2025 decreased to EUR 4,016 million, impacted by negative other comprehensive income Condensed Consolidated Statement of Comprehensive Income (1 Jan to 30 June, in EUR million) | Item | 2025 | 2024 | | :--------------------------------------- | :---- | :---- | | Net result (before non-controlling interests) | 4,042 | 4,575 | | Total other comprehensive income | -26 | 570 | | Total comprehensive income | 4,016 | 5,145 | | Comprehensive income attributable to shareholders of the parent | 3,786 | 5,020 | Condensed Consolidated Statement of Changes in Equity Total equity decreased slightly to EUR 53,321 million, as dividends and share buybacks more than offset net profit Condensed Consolidated Statement of Changes in Equity (in EUR million) | Item | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Balance as at 1 January | 53,698 | 55,628 | | Net result | 4,042 | 4,575 | | Total comprehensive income net of tax | 4,016 | 5,145 | | Dividends and other cash distributions | -2,345 | -2,750 | | Share buyback programmes, commitment | -2,000 | -2,500 | | Share buyback programmes, repurchases of shares | -64 | -43 | | Balance as at 30 June | 53,321 | 55,505 (30 June 2024) | Condensed Consolidated Statement of Cash Flows Net cash flow from operating activities increased significantly to EUR 10,491 million in 1H2025, driving a higher overall net cash flow Condensed Consolidated Statement of Cash Flows (1 Jan to 30 June, in EUR million) | Item | 2025 | 2024 | | :--------------------------------------- | :------ | :------ | | Net cash flow from operating activities | 10,491 | 5,948 | | Net cash flow from investing activities | -8,829 | -6,532 | | Net cash flow from financing activities | 9,268 | 10,948 | | Net cash flow | 10,931 | 10,364 | | Cash and cash equivalents at end of the period | 79,389 | 102,010 | Notes to the Condensed Consolidated Interim Financial Statements Basis of Preparation and Significant Changes Financials are prepared under IFRS-IASB, with the IAS 39 carve-out for hedge accounting being the key difference from IFRS-EU - The report uses IFRS-IASB for SEC reporting, differing from IFRS-EU primarily in IAS 39 hedge accounting for portfolio hedges of interest rate risk[196][200] Reconciliation of Net Result (IFRS-EU vs IFRS-IASB) (1 Jan to 30 June, in EUR million) | Item | 2025 | 2024 | | :--------------------------------------- | :---- | :---- | | Net result IFRS-EU (attributable to parent) | 3,130 | 3,358 | | Adjustment of EU IAS 39 carve-out | 1,065 | 1,512 | | Tax effect of adjustment | -279 | -414 | | Effect of adjustment after tax | 786 | 1,099 | | Net result IFRS-IASB (attributable to parent) | 3,915 | 4,456 | Reconciliation of Shareholders' Equity (IFRS-EU vs IFRS-IASB) (1 Jan to 30 June, in EUR million) | Item | 2025 | 2024 | | :--------------------------------------- | :------ | :------ | | Shareholders' equity IFRS-EU (attributable to parent) | 49,115 | 50,147 | | Adjustment of EU IAS 39 carve-out | 4,443 | 6,413 | | Tax effect of adjustment | -1,268 | -1,871 | | Effect of adjustment after tax | 3,175 | 4,542 | | Shareholders' equity IFRS-IASB | 52,290 | 54,689 | Financial Assets at Fair Value Through Profit or Loss These assets increased to EUR 152.5 billion, driven by a rise in mandatorily measured assets and reverse repurchase transactions Financial Assets at Fair Value Through Profit or Loss (in EUR million) | Item | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Trading assets | 64,744 | 72,897 | | Non-trading derivatives | 2,075 | 2,463 | | Designated at fair value through profit or loss | 3,951 | 5,740 | | Mandatorily measured at fair value through profit or loss | 81,715 | 56,481 | | Total | 152,486 | 137,580 | Exposure to (Reverse) Repurchase Agreements (in EUR million) | Item | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Reverse repurchase transactions | 119,502 | 79,675 | | Loans and advances to banks | 35,200 | 10,777 | | Loans and advances to customers | 2,324 | 3,471 | | Trading assets, loans and receivables | 4,392 | 12,033 | | Loans and receivables mandatorily measured at fair value through profit or loss | 77,586 | 53,393 | | Repurchase transactions | 60,629 | 43,723 | Financial Assets at Fair Value Through Other Comprehensive Income These assets increased to EUR 49.8 billion, mainly due to additions to debt securities and an increased stake in Van Lanschot Kempen Financial Assets at Fair Value Through Other Comprehensive Income by Type (in EUR million) | Item | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Equity securities | 2,753 | 2,562 | | Debt securities | 45,618 | 42,219 | | Loans and advances | 1,475 | 1,608 | | Total | 49,846 | 46,389 | - ING increased its ownership in Van Lanschot Kempen from 2.7% to 9.9% in March 2025, with a further increase to 20.3% by July 24, 2025[224][387] - Exchange rate differences of EUR -226 million were mainly related to the stake in Bank of Beijing due to CNY depreciation[228] Debt Securities Total exposure to debt securities increased to EUR 113.9 billion, with government and supranational bonds being the largest categories Exposure to Debt Securities (in EUR million) | Item | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Debt securities at fair value through other comprehensive income | 45,618 | 42,219 | | Debt securities at amortised cost | 53,805 | 50,273 | | Total debt securities at fair value through profit or loss | 14,501 | 15,586 | | Total debt securities | 113,924 | 108,078 | Debt Securities by Type of Exposure (in EUR million) | Type of Exposure | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Government bonds | 52,604 | 47,780 | | Central bank bonds | 4,642 | 3,344 | | Sub-sovereign, Supranationals and Agencies | 29,282 | 27,985 | | Covered bonds | 9,639 | 9,791 | | Corporate bonds | 206 | 1,033 | | Financial institutions' bonds | 1,963 | 3,261 | | ABS portfolio | 5,100 | 4,832 | | Total debt securities portfolio | 103,409 | 97,999 | Loans and Advances to Customers Total loans and advances to customers increased to EUR 693.3 billion, with residential mortgages comprising the largest portion Loans and Advances to Customers by Type (in EUR million) | Type | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Loans and advances to public authorities | 20,930 | 18,661 | | Residential mortgages | 358,708 | 348,594 | | Other personal lending | 38,780 | 36,797 | | Corporate Lending | 280,638 | 285,393 | | Loan loss provisions | -5,771 | -5,833 | | Total | 693,285 | 683,611 | Investments in Associates and Joint Ventures These investments decreased to EUR 1.5 billion, as the share of results from associates declined, primarily from TMBThanachart Bank Investments in Associates and Joint Ventures (in EUR million) | Item | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | TMBThanachart Bank Public Company Limited | 1,191 | 1,266 | | Other investments | 345 | 412 | | Total | 1,536 | 1,679 | - Share of results from associates and joint ventures decreased to EUR 85 million (from EUR 205 million in 2024), primarily from TMBThanachart Bank (TTB)[238][240] - No impairment trigger was observed for the investment in TTB as of June 30, 2025, and no reversal of impairment was recognized[241] Customer Deposits Customer deposits increased significantly to EUR 738.0 billion, with savings accounts representing the largest category Customer Deposits by Type (in EUR million) | Type | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Current accounts / Overnight deposits | 232,153 | 227,827 | | Savings accounts | 379,403 | 354,560 | | Time deposits | 120,143 | 107,695 | | Other | 6,329 | 1,579 | | Total | 738,028 | 691,661 | Financial Liabilities at Fair Value Through Profit or Loss These liabilities increased to EUR 93.5 billion, driven by a rise in liabilities designated at fair value through profit or loss Financial Liabilities at Fair Value Through Profit or Loss (in EUR million) | Item | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Trading liabilities | 26,387 | 35,255 | | Non-trading derivatives | 2,499 | 2,101 | | Designated at fair value through profit or loss | 64,637 | 49,543 | | Total | 93,524 | 86,900 | Debt Securities in Issue Debt securities in issue increased to EUR 151.0 billion as new issuances significantly outweighed redemptions Changes in Debt Securities in Issue (in EUR million) | Item | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Opening balance as at 1 January | 142,367 | 124,670 | | Additions | 80,301 | 124,701 | | Redemptions / Disposals | -65,413 | -113,014 | | Foreign exchange movement | -6,919 | 3,512 | | Closing balance | 151,016 | 142,367 | Subordinated Loans Subordinated loans decreased to EUR 16.6 billion following the redemption of Tier 2 and AT1 securities Changes in Subordinated Loans (in EUR million) | Item | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Opening balance as at 1 January | 17,878 | 15,401 | | Additions | 1,232 | 4,603 | | Redemptions / Disposals | -1,818 | -2,931 | | Foreign exchange movement | -1,000 | 565 | | Closing balance | 16,566 | 17,878 | - ING Groep N.V. issued EUR 1.25 billion 4.13% Fixed Rate Subordinated Green Tier 2 Notes in May 2025[251] - ING Groep N.V. redeemed EUR 750 million Tier 2 notes in March 2025 and USD 1.25 billion AT1 securities in April 2025[252] Equity Total equity decreased to EUR 53.3 billion, primarily due to share buybacks and negative currency translation movements Total Equity (in EUR million) | Item | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Share capital and share premium | 17,148 | 17,148 | | Other reserves | -3,158 | -687 | | Retained earnings | 38,300 | 36,243 | | Shareholders' equity (parent) | 52,290 | 52,703 | | Non-controlling interests | 1,031 | 995 | | Total equity | 53,321 | 53,698 | - Treasury shares increased significantly to EUR -2,746 million (from EUR -765 million) due to ongoing share buyback programs[254][259] - The currency translation reserve saw a net decrease of EUR -813 million, mainly due to USD, TRY, GBP, and AUD exchange rate differences[256] Net Interest Income Net interest income decreased to EUR 7.3 billion for 1H2025, driven by lower total interest income Net Interest Income (1 Jan to 30 June, in EUR million) | Item | 2025 | 2024 | | :--------------------------------------- | :------ | :------ | | Total interest income | 25,842 | 29,929 | | Total interest expense | -18,552 | -22,166 | | Net interest income | 7,290 | 7,762 | - Net interest income was affected by a EUR 131 million impact from reversing the EU 'IAS 39 carve-out' hedge accounting[263] Net Fee and Commission Income Net fee and commission income increased to EUR 2.2 billion for 1H2025, showing broad-based growth across services Net Fee and Commission Income (1 Jan to 30 June, in EUR million) | Item | 2025 | 2024 | | :--------------------------------------- | :---- | :---- | | Fee and commission income | 3,090 | 2,757 | | Payment Services | 1,217 | 1,072 | | Securities business | 482 | 395 | | Insurance and other broking | 327 | 287 | | Portfolio management | 386 | 339 | | Lending business | 311 | 313 | | Fee and commission expenses | 874 | 760 | | Net fee and commission income | 2,216 | 1,998 | Valuation Results and Net Trading Income This income decreased to EUR 2.8 billion for 1H2025, as negative derivatives results offset strong securities trading Valuation Results and Net Trading Income (1 Jan to 30 June, in EUR million) | Item | 2025 | 2024 | | :--------------------------------------- | :------ | :------ | | Securities trading results | 2,194 | 492 | | Derivatives trading results | -1,169 | 292 | | Foreign exchange transactions results | 3,190 | -1,630 | | Total | 2,773 | 3,016 | - The EU 'IAS 39 carve-out' adjustment had a EUR 933 million impact on valuation results and net trading income[266] Other Operating Expenses Other operating expenses increased to EUR 2.5 billion for 1H2025, driven by higher IT, outsourcing, and provision costs Other Operating Expenses (1 Jan to 30 June, in EUR million) | Item | 2025 | 2024 | | :--------------------------------------- | :---- | :---- | | Promotional and client acquisition costs | 206 | 199 | | IT related expenses | 382 | 353 | | Outsourcing and subcontracting | 327 | 296 | | Regulatory costs | 439 | 446 | | Depreciation and impairment of property and equipment | 218 | 231 | | Amortisation and impairment of intangible assets | 111 | 109 | | Additions and releases of provisions | 150 | 91 | | Total | 2,485 | 2,393 | - Regulatory costs for 1H2025 included EUR 136 million for Deposit Guarantee Schemes and EUR 41 million for SRF/local resolution funds[272] Earnings Per Ordinary Share Basic and diluted earnings per share both decreased to EUR 1.29 for 1H2025 due to a lower net result Earnings Per Ordinary Share (1 Jan to 30 June) | Item | 2025 (EUR) | 2024 (EUR) | | :--------------------------------------- | :--------- | :--------- | | Basic earnings per ordinary share | 1.29 | 1.35 | | Diluted earnings per ordinary share | 1.29 | 1.35 | Weighted Average Number of Ordinary Shares Outstanding (in millions) | Item | 2025 | 2024 | | :--------------------------------------- | :-------- | :-------- | | Basic | 3,041.9 | 3,292.5 | | Diluted | 3,041.9 | 3,295.8 | Dividend Per Ordinary Share An interim dividend of EUR 0.350 per share was declared for 1H2025, with the total 2024 dividend amounting to EUR 1.06 per share Dividends to Shareholders of the Parent (in EUR) | Item | Per Ordinary Share | Total (in EUR million) | | :--------------------------------------- | :----------------- | :--------------------- | | In respect of 2024 | | | | Interim dividend, paid August 2024 | 0.350 | 1,129 | | Final dividend, paid May 2025 | 0.710 | 2,152 | | Total dividend in respect of 2024 | 1.060 | 3,281 | | In respect of 2025 | | | | Interim dividend declared | 0.350 | 1,043 | Additional Notes to the Condensed Consolidated Interim Financial Statements Segments Performance is monitored by banking segments and a Corporate Line, with the latter's income boosted by hedging and dividends in 1H2025 - ING Group monitors performance by segments (Retail Netherlands, Belgium, Germany, Other, Wholesale Banking) and a Corporate Line, using IFRS-EU results[279][283][284] - The Corporate Line's total income in 1H2025 was EUR 265 million, driven by higher foreign currency hedging income and dividends from Asian stakes[290] ING Group Total (IFRS-EU) (1 Jan to 30 June, in EUR million) | Item | 2025 | 2024 | | :--------------------------------------- | :------ | :------ | | Net interest income | 7,159 | 7,655 | | Net fee and commission income | 2,216 | 1,998 | | Total investment and other income | 1,965 | 1,647 | | Total income | 11,339 | 11,300 | | Operating expenses | 6,234 | 5,880 | | Addition to loan loss provisions | 612 | 559 | | Result before taxation | 4,493 | 4,861 | | Net result IFRS-EU | 3,130 | 3,358 | Fair Value of Assets and Liabilities Fair values are determined using a three-level hierarchy, with most Level 3 assets based on quoted prices in inactive markets - Fair values are determined using a hierarchy: Level 1 (quoted prices in active markets), Level 2 (observable inputs), and Level 3 (unobservable inputs)[297][298] Adjustments in Fair Value on Financial Assets and Liabilities (in EUR million) | Item | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Deferred Day One Profit or Loss | -93 | -94 | | Own credit adjustments | -24 | -17 | | Bid/Offer | -150 | -130 | | Model Risk | -49 | -33 | | CVA | -138 | -123 | | DVA | 42 | 50 | | CollVA | -2 | -3 | | FVA | -98 | -64 | | Other valuation adjustments | 2 | 2 | | Total Valuation Adjustments | -511 | -412 | - Of the EUR 11.6 billion Level 3 financial assets, EUR 9.5 billion (81.9%) are based on unadjusted quoted prices in inactive markets, showing no significant sensitivity to ING's own unobservable inputs[319] - The sensitivity analysis for Level 3 instruments shows potential fair value movements of +EUR 37 million and -EUR -28 million from using alternative unobservable inputs[341] Legal Proceedings The Group is involved in various legal proceedings, including investor claims on AML shortcomings and uncertainty from a CJEU ruling in Poland - ING faces litigation from investors claiming EUR 587 million in damages related to historical financial economic crime policies and the 2018 settlement[355] - An investigating judge in Luxembourg intends to prepare a criminal indictment against ING Luxembourg for alleged AML shortcomings[357] - A recent CJEU ruling questioned the "two-claims theory" in Polish jurisprudence for invalidated mortgage contracts, creating legal uncertainty for banks[370][371][372] - Milieudefensie initiated legal proceedings against ING in March 2025, holding the bank liable for alleged contributions to climate change[374] Potential Sale of ING Bank (Eurasia) JSC The sale of ING's Russian business is expected to close in Q3 2025 with an estimated negative post-tax impact of EUR 0.8 billion - ING agreed to sell its Russian business (ING Bank (Eurasia) JSC), with closing expected in Q3 2025, pending regulatory approvals[377] - ING estimates a negative post-tax impact of EUR 0.8 billion from the sale, comprising an estimated EUR 0.5 billion book loss and a EUR 0.3 billion currency translation impact[379] - No loss was recognized as of June 30, 2025, due to uncertainties, and assets were not classified as held for sale[380] Capital Management The CET1 ratio decreased to 13.3% due to a share buyback program, remaining above the target level of around 12.5% Capital Position (in EUR million) | Item | 30 June 2025 | 31 December 2024 | | :--------------------------------------- | :----------- | :--------------- | | Available common equity Tier 1 capital | 44,534 | 45,260 | | Risk weighted assets | 335,804 | 333,708 | | Common equity Tier 1 ratio | 13.3 % | 13.6 % | | Tier 1 ratio | 15.1 % | 16.0 % | | Total capital ratio | 18.2 % | 18.9 % | - The CET1 ratio decreased due to a EUR 2,000 million deduction for the ongoing share buyback program, partially offset by net profit[381] - ING's distribution policy targets a 50% pay-out ratio on resilient net profit, primarily in cash[384] Subsequent Events ING increased its stake in Van Lanschot Kempen to 20.3% but will continue to classify it as a passive investment at FVOCI - As of July 24, 2025, ING increased its stake in Van Lanschot Kempen to 20.3%[387] - Despite exceeding 20% voting rights, the investment will be classified as fair value through other comprehensive income (FVOCI) due to ING's passive investment purpose[387] Other Information Alternative Performance Measures The company uses APMs like resilient net profit and net core lending growth to provide a clearer view of its commercial performance - Resilient net profit is defined as net profit adjusted for significant items not linked to the normal course of business[392] - Net core lending and deposits growth measures real commercial growth, adjusted for currency impacts and non-core portfolios[392] - Commercial net interest income focuses on interest-driven products and excludes significant volatile items for better comparison[392] SIGNATURES