ING Direct 2008 Annual Report Download - page 44

ING Group Annual Report 2008
1.2 Report of the Executive Board
42
State-of-the-art IT systems
Excellent direct banking facilities require advanced IT support.
ING Direct has highly integrated, 24/7 online and synchronised
distribution channels. We are always looking to achieve industry-
leading reliability and provide flawless service to end-users and
customers in order to remain competitive. In 2008, the business
continued to invest in systems to ensure that they are highly
secure, in addition to being flexible and cost-effective.
CONCLUSIONS AND AMBITIONS
In 2008, ING Direct continued to put the customer first, and will
continue to do so. Despite the market turmoil, ING Direct
produced positive commercial results. It is strictly monitoring
expenses, risk and capital. Given the current priorities of preserving
ING’s capital position and the worsening economy, ING Direct will
reduce expenses by about EUR 150 million in 2009, through lower
operating and marketing expenses, and a headcount reduction
of around 600 FTEs. ING Direct will continue to gradually expand
the product range.
Payment accounts – showing growth potential
Payment accounts help to develop a broader relationship with the
customer and increase the share of a customer’s total potential
business. It has also become a client acquisition tool; by offering
a broader range of products, ING Direct can effectively compete
with local competitors and diversify its income stream.
The performance of payment accounts was encouraging in 2008:
431,000 new accounts were opened in Spain, the United States
Germany and Italy, bringing the total to 1.3 million accounts over
2008. Payment accounts were launched in Italy in October and
8,000 accounts had been opened by year-end. Launches are being
prepared in France and Australia in 2009.
Investment products – good results at ShareBuilder
Despite the ongoing financial crisis, ING Direct reported substantial
net inflows of customers and funds in investment products,
primarily in the US and Germany. Total balances of off-balance
funds, however, declined by EUR 3.6 billion to EUR 15.1 billion
as a result of lower asset prices.
An example of strong net inflows is ING Direct’s US-based
online brokerage platform, ShareBuilder. It showed strong growth
during its first full year of operation with ING Direct, welcoming
315,000 new customers, bringing the total number of customers
to 1.2 million at year-end. Of new accounts, 21% resulted from
cross-sell efforts to ING Direct’s customer base, evidencing the
synergies between the two companies. Net asset inflows totalled
EUR 655 million (USD 914 million).
ING Direct recognises the future potential of investment products
and has launched initiatives in Canada and Italy.
Customer satisfaction – meeting expectations
One of ING Direct’s most valuable assets remains its high level
of customer satisfaction, standing at the core of the company’s
success. Research shows customers perceive ING Direct as
innovative, reliable, value-for-money, easy to deal with and fair.
93% of customers state that their expectations are met. ING
Direct’s aided brand awareness is now 73-95% in all markets
in which it operates.
Number of clients, total funds entrusted, residential mortgage portfolio, off-balance sheet funds
Clients in thousands
Funds entrusted, residential mortgage portfolio and
off-balance sheet funds in EUR billion
Clients
Funds
entrusted
Residential mortgage
portfolio
Off-balance sheet
funds
2008 2007 2008 2007 2008 2007 2008 2007
Canada 1,562 1,526 13.4 13.9 13.5 13.2 0.2 0.2
Spain 1,836 1,624 12.5 12.9 7.7 6.5 1.5 1.9
Australia 1,363 1,316 9.2 12.0 16.9 18.3 – –
France 751 716 10.3 12.9 – –1.4 1.5
United States 7,546 6,524 51.5 41.3 25.2 17.9 1.7 1.8
Italy 1,103 937 14.6 14.2 5.3 3.3 0.3 0.4
Germany/Austria 6,646 6,481 63.2 62.0 43.7 35.9 10.1 12.9
United Kingdom 1,330 1,137 16.2 22.3 1.3 1.9 –
Total 22,172 20,262 191.0 191.5 113.7 97.0 15.1 18.8
ING Direct (continued)