ING Direct 2013 Annual Report Download - page 385

ING Bank Regulatory Capital flow statement
2013 2012
Core Tier 1 capital
Opening amount 33,354 31,761
Profit 3,063 3,281
Adjustment prudential filters own credit risk 97 468
Change in goodwill 158 130
Dividend –2,955 –2,125
Change in revaluation reserves –726 –471
Change in third party interest 113 148
Change in deductions from tier 1 –91 25
Other 97 137
Closing amount 33,110 33,354
Additional Tier 1 capital
Opening amount 6,774 6,850
Issued capital
Redeemed capital –1,506
Exchange rate differences –146 –75
Closing amount 5,122 6,774
Tier 2 capital
Opening amount 7,142 8,502
Change in Tier 2 capital instruments 1,212 –1,384
Change in deductions –91 24
Closing amount 8,263 7,142
Total regulatory capital 46,496 47,270
Unless stated otherwise, the tables in Pillar 3 are focused on credit risk and market risk only and therefore exclude ONCOA, equities, and
operational risk.
Capital adequacy assessment
The Basel II capital adequacy is based on the guidelines developed by the Basel Committee on Banking Supervision 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.
The table below reflects own funds according to the CRD and Dutch legislation, both using the Basel II rules (as specified in the CRD III)
and the Basel III rules (as specified in the CRR/CRD IV). As Basel III will be phased in gradually during 2014-2019, the table shows the Basel
III positions both according to the 2019 end state rules and to the 2014 rules. This makes clear which items phase in directly, which
gradually and which not yet in 2014.
ING Bank’s capital consists of Tier 1 capital (referred to as ‘original own funds’ in CRD III) and Tier 2 capital (referred to as ‘additional own
funds’ in CRD III) net after deductions. Tier 1 capital consists of both core Tier 1 capital (referred to as ‘Common equity tier 1’ in CRR/CRD
IV) and other Tier 1 capital, also referred to as hybrid capital. Tier 2 capital consists mostly of subordinated loans.
ING Bank continues to maintain strong and high quality capital levels. ING Bank is already meeting the Basel III solvency requirements with
a fully-loaded core Tier 1 ratio of 10.0%. This percentage is calculated on the basis of immediate and full implementation and disregarding
the possible impact of future management actions.
Additional Pillar 3 information continued
383ING Group Annual Report 2013
1 Who we are 2 Report of the Executive Board 3 Corporate governance 4 Consolidated annual accounts 5 Parent company annual accounts 6 Other information 7 Additional information