ING Direct 2009 Annual Report Download - page 254

Capital position of ING Bank
2009 2008
Shareholders’ equity (parent) 30,222 22,889
Minority interests 960 1,198
Subordinated loans qualifying as Tier 1 capital (1) 8,057 7,085
Goodwill and intangibles deductible from Tier 1 –1,636 –1,636
Deductions Tier 1 –1,073 –1,040
Revaluation reserve (2) –2,515 3,523
Available capital – Tier 1 34,015 32,019
Supplementary capital – Tier 2 (3) 11,789 12,910
Available Tier 3 funds
Deductions –1,073 –1,040
BIS capital 44,731 43,889
Risk-weighted assets 332,375 343,388
Tier 1 ratio 10.23% 9.32%
BIS ratio 13.46% 12.78%
Required capital based on Basel I floor (4) 28,709 34,369
BIS ratio based on Basel I floor (4) 12.46% 10.22%
(1) Subordinated loans qualifying as Tier 1 capital have been placed by ING Groep N.V. with ING Bank N.V.
(2) Includes revaluation debt securities, revaluation reserve cash flow hedge and revaluation reserves equity and real estate (see Capital base table, note 3).
(3) Includes eligible lower Tier 2 loans and revaluation reserves equity and real estate revaluations removed from Tier 1 capital.
(4) Using 80% and 90% of Basel I Risk Weighted Assets in 2009 and 2008 respectively. In case a 80% floor would have been used in 2008, the required capital
would have been EUR 30,550 million and the BIS ratio based on Basel I floor 11.49%.
ING INSURANCE
European Union directives require insurance companies established in member states of the European Union to maintain minimum capital
positions. The ING Insurance companies outside the EU have to comply with their respective local requirements. ING Insurance’s companies
comply with local regulatory requirements. The table below shows the global required capital of ING Insurance measured on the basis of the
European Union requirement. This requirement is compared with ING Insurance consolidated available capital.
Capital position of ING Insurance
2009 2008
Available capital (1) 21,022 22,010
Required capital 7,774 8,582
Surplus capital 13,248 13,428
Ratio of available versus required capital 270% 256%
(1) For breakdown of available capital see Capital base table.
Under ING’s internal economic capital (EC) and market value balance sheet approach, the ratio of Available Financial Resources (AFR) to EC
was 107% at the end of 2009 compared to 106% at the end of 2008.
ING GROUP
ING Group reports to the Dutch Central Bank as required under the Dutch implementation of the financial conglomerates directive. The
directive mainly covers risk concentrations in the group, intra-group transactions and an assessment of the capital adequacy of the Group.
In the following table, we show the Group’s capital adequacy on the following basis:
Insurance required capital from applying European Solvency I rules to all of ING Insurance entities globally (regardless of local •
capital requirements);
Bank required capital based on applying Basel II with the Basel I floor. (80% and 90% in 2009 and 2008 respectively);•
Group available capital using an approach similar to that used for Bank BIS capital whereby IFRS equity is adjusted for certain revaluation •
reserves, minority interests are added, goodwill and certain intangibles are deducted and Group hybrids and qualifying subordinated
debt of Bank and Insurance are included.
ING Group Annual Report 2009
252
Capital management (continued)
2.1 Consolidated annual accounts