The payment includes a EUR 817 million repayment of core Tier 1 securities and EUR 408 million in premiums and interest. After this payment the total amount paid to the Dutch State will be EUR 12.5 billion, including EUR 9.3 billion in principal and EUR 3.2 billion in interest and premiums.
"Next week’s payment of EUR 1.225 billion to the Dutch State will bring ING another step closer to full repayment of the EUR 10 billion support we received from the Dutch State during the financial crisis" said Ralph Hamers, CEO of ING Group. "With this payment we will have paid the Dutch State over EUR 12.5 billion in principal, interest and premiums and we intend to make our final payment ultimately in May of next year, resulting in a total annualised overall return for the Dutch state of 12.5%".
The payment of EUR 1.225 billion is the third tranche of a series of 4 tranches that are part of the aforementioned EC Restructuring Plan. This payment will include the approximate capital gain from exchange offers as announced on 15 November 2013 as well as the net financial benefit of the call of the USD 2 billion 8.5% Hybrid Tier 1 and the call of the EUR 1.5 billion 8% Hybrid Tier 1 which were announced in November 2013 and March 2014 respectively, together totalling EUR 100 million. The fourth and final tranche, which will be paid ultimately in May 2015, will amount to EUR 1.025 billion, including EUR 683 million in principal and EUR 342 million in interest and premiums, therefore the total amount of repayments to the Dutch State, totalling EUR 13.5 billion remains unchanged.
The payment of EUR 1.225 billion, which has been approved by the Dutch Central Bank, will be funded by a dividend to be upstreamed from ING Bank to ING Group. The capital ratios of ING Bank remain strong. The dividend will lead to a reduction of the Bank’s core Tier 1 ratio of approximately 40 basis points.
