ING to split in two, launch 7.5 billion rights issue

ING to split in two, launch 7.5 billion rights issue

The company also said it would pay back 50 per cent of its aid from the Dutch state early and launch a €7.5 billion ($11.25 billion) rights issue.

Monday’s surprise announcement from ING accelerates a move that investors had expected, but not for years to come. It effectively dismantles something of a national champion that was created just 18 years ago. The dismantling process, which is expected to run through 2013, will leave its balance sheet 30 per cent smaller than before its bailout. ING said it would be “predominantly focused on Europe with selective growth options elsewhere.”

Ownership of sales

Royal Bank of Scotland and Lloyds Bank Group, 70 per cent and 43 per cent respectively owned by Britain, are expected to be ordered into disposals by the European Commission.
Belgium’s KBC and Franco-Belgian Dexia are also awaiting rulings from the executive arm of the 27-member European Union.

ING said the divestment of the insurance operations would be completed by 2013, through IPOs and or sales.
ING will also split off some Dutch mortgage operations into a new company that would have about a 6 per cent share of the Dutch mortgage market.