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    Hugh Moorhead • Berenberg

    Hugh Moorhead's questions to ING Groep NV (ING) leadership

    Hugh Moorhead's questions to ING Groep NV (ING) leadership • Q2 2024

    Question

    Hugh Moorhead asked if the strong performance in insurance fee income was a one-off or a structural trend. He also questioned the normalization of risk costs and the evolution of management overlays, requesting quantification of the impact from transferring Russian exposures to Stage 3.

    Answer

    Executive Steven van Rijswijk described the fee growth as structural, driven by acquiring more customers and increasing cross-sell of investment and insurance products from a low base. CRO Ljiljana Cortan clarified that risk costs were 18 basis points including overlays. She specified that the net impact of the Russian exposure transfer on this quarter's risk costs was €39 million, resulting from a €133 million Stage 3 addition partially offset by a Stage 2 release.

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    Hugh Moorhead's questions to ING Groep NV (ING) leadership • Q2 2024

    Question

    Hugh Moorhead asked about the drivers of strong fee income from insurance, questioning if it was structural or a one-off. He also inquired about risk cost normalization, the use of overlays, and the quantified impact of transferring Russian exposures to Stage 3.

    Answer

    CEO Steven van Rijswijk explained that the strong fee performance is structural, driven by growth in mobile primary customers and increased cross-selling of investment and bespoke insurance products from a low base. CRO Ljiljana Cortan detailed the risk costs, stating the net impact from the Russian exposure transfer was EUR 39 million in additional risk costs for the quarter. She clarified that overlays are included in the through-the-cycle risk cost calculation and are used when models don't fully capture environmental risks.

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