ING Direct 2002 Annual Report Download - page 29

Annual Report 2002 · ING Group26
Report of the Executive Board
1. Strengthen the capital base and
improve other key ratios to main-
tain a solid financial foundation
ING will give the highest priority to strengthening
its capital base and to improving its ratings. The
measures announced at the publication of the
results for the first nine months of 2002, such as
the issue of perpetual bonds, the sale of own
shares held to hedge employee stock options
and the re-introduction of optional stock/cash
dividend, are the basis for achieving this
objective. The Executive Board has also taken a
series of other measures to reinforce the capital
base and reduce the dependency of ING’s
business on stock-market developments.
Furthermore, ING will continue its efforts
to improve its efficiency, return on equity, return
on required capital (insurance), risk-adjusted
return on capital (banking) and debt/equity
ratios.
2. Optimise the existing portfolio
Focus and execution are the key words in the
plans to respond to the new economic environ-
ment. ING will focus more in terms of activities it
wishes to expand or scale down and in terms of
markets it wants to be in or withdraw from. No
large acquisitions will be made in the near
future. In markets where reinforcement of the
distribution capacity is an immediate priority,
ING will seek to enter into joint ventures with
local partners.
ING will be very selective about investment
choices and deployment of resources. In this
connection, the Executive Board is reviewing the
countries in which ING is active, the business
lines and the client base. Risk management in
both the insurance and banking operations will
be intensified to enable more pro-active
decisions. In the field of operations/information
technology, ING will complete the many
integration and restructuring projects as well as
the shared services centres.
3. Create value for the clients
with a multi-product/
multi-channel approach
From the start, ING has chosen integrated
financial services as the heart of its strategy. The
power of the integrated financial services
concept is in the multi-channel/multi-product
approach. Clients appreciate a full range of
products and they expect to be served via the
distribution channel of their choice. That choice
may depend on the type of product: the internet
for simple products such as savings deposits, a
call centre for applying for an insurance policy
or a credit card and a professional intermediary
for advice on a tailor-made retirement plan. In
mature markets, ING Direct has proven to be an
effective, cost-efficient and profitable entry
strategy for retail markets, responding to current
demands. In developing markets, the greenfields
that ING started from scratch have matured.
GROUP STRATEGY AND OUTLOOK
RESPOND TO
THE NEW REALITY
The first ten years since ING’s foundation in 1991 were
characterised by high growth and favourable market
conditions. At the beginning of the 21st century, the economic
tide started to turn and the world has now entered the third
consecutive year of low or no economic growth. The
challenge for ING will be to respond to this new reality and
secure a stable long-term development of the Group for the
benefit of all its stakeholders. The Executive Board has
decided on the following Group strategic objectives for the
years 2003-2005.
 
Focus on stable long-term
development of the Group
for the benefit of all stake-
holders
—
Measures taken to reinforce
capital base and to reduce
dependency on stock
markets
—
No large acquisitions in the
near future