ING Groep(ING) - 2025 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The return on equity for 2025 was 13.2%, exceeding initial guidance [5] - Total income reached a record level for the third consecutive year, with commercial net interest income (NII) at EUR 15.3 billion despite lower interest rates [5][6] - Net profit for the year was over EUR 6.3 billion, contributing almost two percentage points to the CET1 ratio [7] Business Line Data and Key Metrics Changes - The loan book grew by 8.3% in 2025, primarily driven by residential mortgages, while the deposit book increased by 5.5% [4] - Fee income grew by 15% year-on-year, with investment products seeing a 21% increase in fee income [5][6] - The number of Mobile Primary Customers increased by over 350,000 in Q4, totaling over 1 million for the year [4] Market Data and Key Metrics Changes - Customer deposit growth was 4.5% in 2025, supported by successful promotional campaigns [19] - The company maintained its number one position in retail banking in 5 out of 10 markets and ranked in the top three in all markets [7] Company Strategy and Development Direction - The company aims for total income to grow to around EUR 24 billion in 2026, supported by continued volume growth and a 5%-10% increase in fee income [9] - A focus on cost discipline and operational efficiency is evident, with projected operating expenses for 2026 in the range of EUR 12.6 billion to EUR 12.8 billion [9] - The company plans to issue between EUR 6 billion and EUR 8 billion of Holdco Senior in 2026, aligning with its issuance in 2025 [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength and quality of the loan book, with total risk costs in line with the through-the-cycle average [11] - The company remains committed to supporting clients in their sustainability transitions, with total sustainable volume mobilized reaching EUR 166 billion, a 28% increase year-on-year [5] - The outlook for 2027 includes expectations for total income to exceed EUR 25 billion, with a higher fee income target now expected to exceed EUR 5 billion [9] Other Important Information - The CET1 ratio decreased to 13.1% due to an additional distribution of EUR 1.6 billion [14] - The company has a stable liquidity profile, with over two-thirds of the balance sheet funded by customer deposits [19] Q&A Session Summary Question: Plans for tapping the ECB, MROs, and LTROs - Management stated that the company prefers to be self-sufficient and does not want to rely on central bank operations, but may consider them for economic reasons if necessary [25][26]