ING Direct 2015 Annual Report Download - page 283

Contents
Report of the
Executive Board
Corporate
Governance
Consolidated
annual accounts
Parent company
annual accounts
Other
information
Additional
information
Additional Pillar III information - continued
2015 median in EUR million
Fair value of
encumbered
collateral
received or own
debt securities
issued
Fair value of
collateral
received or own
debt securities
issued available
for encumbrance
Collateral received by ING Bank
69,988
40,384
Equity instruments
16,076
5,891
Debt securities
53,911
34,033
Other collateral received
460
Own debt securities issued other than own covered bonds or ABSs
69,988
40,384
2014 in EUR million
Fair value of
encumbered
collateral
received or own
debt securities
issued
Fair value of
collateral
received or own
debt securities
issued available
for encumbrance
Collateral received by ING Bank
61,805
40,506
Equity instruments
3,721
15,787
Debt securities
57,876
24,432
Other collateral received
114
Own debt securities issued other than own covered bonds or ABSs
2015 median in EUR million
Matching
liabilities,
contingent
liabilities or
securities lent
Assets, collateral
received and own
debt securities
issued other than
covered bonds
and ABSs
encumbered
Carrying amount of selected financial liabilities
108.536
146.697
2014 in EUR million
Matching
liabilities,
contingent
liabilities or
securities lent
Assets, collateral
received and own
debt securities
issued other than
covered bonds
and ABSs en-
cumbered
Carrying amount of selected financial liabilities
100,935
141,156
ING Bank manages its balance sheet prudently whereby a variety of funding sources is readily available. Given this situation, the level of
encumbrance of ING Bank’s balance sheet is relatively low.
Encumbered assets on ING Bank’s balance sheet comprise to a large extent mortgages and other loans which are used as cover pool for
covered bond programs issued by subsidiaries in the Netherlands, Belgium and Germany, as well as external securitisations and
other types of
collateralized deposits. Of the total e
ncumbered assets of the Bank, EUR 82 billion are loans and advances, mostly mortgages, that serve as
collateral for these type of liabilities. The cover pool assets are not considered encumbered when the securities are retaine
d within ING Bank.
The issued
securitisations and especially the covered bonds have over collateralisation, meaning that the assets in the cover pool are higher
than the issuance.
Furthermore, assets are encumbered as a result of the repo- and securities lending business and cash and securities collateral posted for
derivative and clearing transactions in which pledging collateral is a requirement. As part of its normal securities financin
g and derivatives
trading activities ING enters into standard master agreements such as ISDA and G
lobal Master Repurchase Agreements (GMRA), which contain
Credit Support Annexes (CSA) or other similar clauses. Under the terms of these contracts ING could be required to provide ad
ditional collateral
in the event ING is downgraded by one of the establish
ed rating agencies. Refer to the paragraph Counterparty Credit Risk.
The main part of ING Bank’s repo- and reverse repo activities are short-term dated. Repo transactions are mostly conducted with securities
which have been obtained as collateral in rever
se repo transactions, which are not recognized on the balance sheet. Where securities
recognized on the balance sheet have been used in a repo transaction, these remain recognized on the balance sheet and are re
ported as
encumbered. Of the unencumbered oth
er assets included in the table ‘Assets’, the vast majority of the assets is not available for
encumbrance. This category comprises assets such as derivative receivables, tax assets, property and equipment, intangible as
sets and
investments in associates and joint ventures.
Collateral received ING Bank
Collateral received ING Bank
Encumbered assets/collateral received and associated liabilities ING Bank
Encumbered assets/collateral received and associated liabilities ING Bank
Information on importance of encumbrance ING Bank
ING Bank Annual Report 2015 281