ING Direct 2008 Annual Report Download - page 234

2.1 Consolidated annual accounts
Capital management (continued)
REGULATORY REQUIREMENTS
ING Bank
Capital adequacy and the use of regulatory required capital are based on the guidelines developed by the Basel Committee on Banking
Supervision (The Basel Committee) and the European Union Directives, as implemented by the Dutch Central Bank (DNB) for supervisory
purposes. The minimum Tier-1 ratio is 4% and the minimum total capital ratio (known as the BIS ratio) is 8% of all risk-weighted assets.
Capital position of ING Bank
2008 2007
Shareholders’ equity (parent) 22,889 25,511
Minority interests 1,198 1,668
Subordinated loans qualifying as Tier-1 capital (1) 7,085 6,397
Goodwill and intangibles deductible from Tier-1 –1,636 –1,428
Deductions Tier-1 (as of 2007) –1,040 –93
Revaluation reserve (2) 3,523 –2,283
Available capital – Tier-1 32,019 29,772
Supplementary capital – Tier-2 (3) 12,910 14,199
Available Tier-3 funds
Deductions –1,040 –2,407
BIS capital 43,889 41,564
Risk-weighted assets (4) 343,388 402,727
Tier-1 ratio (4) 9.32% 7.39%
BIS ratio (4) 12.78% 10.32%
Required capital based on Basel I floor (5) 34,369
Required capital based on Basel I floor as at 1/1/09 (5) 30,550
BIS ratio based on Basel I floor 10.22%
BIS ratio based on Basel I floor as at 1/1/09 11.49%
(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) Based on Basel II as of 2008.
(5) 90% of Basel I Risk Weighted Assets in 2008 and 80% in 2009.
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 position 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
2008 2007
Available capital (1) 22,010 22,965
Required capital 8,582 9,405
Surplus capital 13,428 13,560
Ratio of available versus required capital 256% 244%
(1) For breakdown of available capital see Capital base table.
ING Group Annual Report 2008
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