ING Groep N.V. — Earnings Release 2012

Feb 13, 2013

PRESS RELEASE

13 February 2013

ING posts 2012 underlying net profi t of EUR 2,603 million

• ING Group's full-year 2012 net result was EUR 3,894 million, or EUR 1.03 per share, including divestments, discontinued operations and special items. The 4Q12 net result was EUR 1,434 million, or EUR 0.38 per share. The 4Q12 underlying net result was EUR 373 million, refl ecting a solid quarter at Insurance and lower Bank results due to incidental items and the Dutch bank tax.
• Bank 4Q12 underlying result before tax was EUR 184 million, refl ecting negative CVA/DVA adjustments, de-risking losses and the Dutch bank tax. The interest margin was relatively stable at 1.33% versus 3Q12 while risk costs increased slightly to EUR 588 million.
• Insurance 4Q12 operating result improved versus 3Q12 to EUR 296 million as the investment spread strengthened to 132 bps. Sales grew 12.7% from 4Q11 and 23.6% from 3Q12 at constant currencies. Underlying result before tax rose to EUR 272 million.

Chairman's Statement

"2012 was a transformational year for ING as we worked decisively on the restructuring of the Group, preparing the Bank and Insurance companies for independent futures," said Jan Hommen, CEO of ING Group. "In the fourth quarter we announced two major divestments of our Asian Insurance/IM businesses. We fi led the IPO registration statement for our US insurance business, and we reached an agreement with the European Commission which gives us more time and greater fl exibility for restructuring. The Bank made strides in optimising its balance sheet and generating capital to meet Basel III requirements while funding a payment of EUR 1.125 billion to the Dutch State and upstreaming an additional EUR 1 billion to the Group to reduce core debt."

"Results for the year held up well, despite the sovereign debt crisis in Europe and weak economic climate which persisted throughout 2012. Underlying net results for the Group were EUR 2,603 million, down just 5.2% from 2011, despite EUR 626 million of de-risking losses at the Bank, a EUR 175 million Dutch bank tax, and higher loan losses as the economy weakened. At Insurance, de-risking and low interest rates put pressure on investment returns, but underlying results recovered as market-related items diminished."

"As the environment around us changes, ING is also evolving as we work to meet our customers' rapidly changing needs and to achieve operational excellence. In the Netherlands as well as in Belgium, we have made great progress in improving service and investing in IT as customers move swiftly towards mobile banking. As our business model evolves, so must our organisation. Retail Banking Netherlands is expanding the transformation programme started in 2011, leading to approximately 1,400 additional redundancies by the end of 2015 and reducing expenses by an additional EUR 120 million per annum from 2016 onwards. At ING Bank in Belgium, employee headcount is expected to decline by 1,000 FTEs by 2015, through natural attrition, leading to EUR 150 million in annual cost savings by 2015. These initiatives come on top of measures announced in Commercial Banking and Insurance Europe last quarter. Combined, all of these programmes accounted for EUR 452 million in after-tax restructuring provisions booked in 2012, but they are essential to drive future performance, reducing annual expenses by a combined EUR 1 billion by 2015."

"Amid all of the changes we are going through, our employees have demonstrated consistent dedication and commitment to keeping our customers' needs paramount. As we embark on 2013, the economic climate remains challenging, and we must be agile to respond quickly to the dynamic environment so that we can deliver sustainable results for the long-term benefi t of all stakeholders."

Key Figures1
	4Q2012	4Q2011	Change	3Q2012	Change	FY2012	FY2011	Change
ING Group key fi gures (in EUR million)
Underlying result before tax Group	455	-849		1,028	-55.7%	3,530	3,803	-7.2%
of which Bank	184	664	-72.3%	983	-81.3%	3,219	4,128	-22.0%
of which Insurance	272	-1,513		44	518.2%	311	-325
Underlying net result	373	-785		692	-46.1%	2,603	2,746	-5.2%
Net result	1,434	1,186	20.9%	609	135.5%	3,894	5,766	-32.5%
Net result per share (in EUR)2	0.38	0.31	22.6%	0.16	137.5%	1.03	1.52	-32.2%
Total assets (end of period, in EUR billion)				1,248	-6.4%	1,169	1,279	-8.6%
Shareholders' equity (end of period, in EUR billion)				53	2.8%	54	47	16.5%
Underlying return on equity based on IFRS-EU equity3	2.8%	-6.9%		5.4%		5.2%	6.5%
Banking key fi gures
Interest margin	1.33%	1.38%		1.34%		1.32%	1.38%
Underlying cost/income ratio	75.7%	66.8%		58.8%		62.5%	61.8%
Underlying risk costs in bp of average RWA	84	62		76		73	48
Core Tier 1 ratio				12.1%		11.9%	9.6%
Underlying return on equity based on IFRS-EU equity3	0.3%	5.7%		7.6%		5.9%	8.8%
Insurance key fi gures
Operating result (in EUR million)	296	349	-15.2%	237	24.9%	1,095	1,658	-34.0%
Investment margin / life general account invested assets (in bps)4	132	129		130
Administrative expenses / operating income (Life & ING IM)	46.5%	46.2%		47.6%		47.5%	43.3%
Underlying return on equity based on IFRS-EU equity3	5.1%	-22.2%		-0.2%		1.8%	-1.1%

The footnotes relating to 1-4 can be found on page 14 of this press release. Note: Underlying fi gures are non-GAAP measures and are derived from fi gures according to IFRS-EU by excluding the impact from divestments and special items.

ING GROUP CONSOLIDATED RESULTS

The operating environment was challenging throughout 2012, with volatile fi nancial markets and an uncertain macroeconomic environment. Against this backdrop, ING Group's full-year 2012 underlying net profi t held up well at EUR 2,603 million, down 5.2% from a year earlier.

In 2012, results at the Bank were impacted by higher risk costs due to weak economic and business fundamentals, negative credit valuation and debt valuation adjustments (CVA/DVA), and losses from proactive de-risking in the investment portfolio. However, good progress was made on balance sheet optimisation and cost containment. The 2012 operating results of Insurance refl ect lower Non-life results, as well as higher administrative expenses stemming primarily from currency impacts and nonrecurring expense releases in 2011. The underlying result before tax at Insurance recovered strongly in 2012, as results in 2011 were severely impacted by an update to policyholder behavior assumptions on the US Closed Block VA. Furthermore, the impact of losses from de-risking and impairments on debt securities diminished at Insurance during 2012, supporting the improvement in underlying results.

In the fourth quarter of 2012, ING Group posted an underlying net result of EUR 373 million, refl ecting a solid quarter at Insurance and lower results at the Bank, which were impacted by the Dutch bank tax and various market-related items. The quarterly net profi t was EUR 1,434 million, supported by gains on the divestment of ING Direct Canada and Insurance Malaysia.

ING Bank recorded a fourth-quarter underlying result before tax of EUR 184 million, including EUR 175 million for the Dutch bank tax for the full year 2012, EUR 188 million of negative CVA/DVA adjustments, and EUR 126 million in losses from de-risking of mainly southern European debt securities. Excluding these impacts and other market-related items, results declined 20.0% from the fourth quarter of 2011, due to higher risk costs, and were 36.2% lower than the third quarter of 2012. The decline on a sequential basis was mainly due to higher liquidity costs following the lengthening of the Bank's funding profi le, seasonally lower results at Financial Markets, and lower results at Retail Banking. The Bank's underlying interest margin was 1.33%, down just one basis point from the third quarter. Strong cost control remains a priority at the Bank; excluding the Dutch bank tax, expenses were stable year-on-year and increased only slightly from the previous quarter. Risk costs remained elevated and increased both year-on-year and sequentially, consistent with the weak economic environment.

ING Bank progressed further with its Ambition 2015 balance sheet optimisation priorities during the fourth quarter. The total Bank balance sheet declined following the sale of ING Direct Canada, and through the reduction of short-term professional funding and seasonally lower activity in Financial Markets. The funding profi le improved as both customer deposits and long-term debt increased. The Bank attracted a net infl ow of EUR 8.2 billion of funds entrusted. Total net lending declined by EUR 2.5 billion due to moderate demand for credit and pricing discipline.

The fourth-quarter operating result of Insurance increased 24.9% to EUR 296 million compared with EUR 237 million in the third quarter of 2012, supported by a higher investment margin as a release from the provision for profi t sharing in the Netherlands offset the impact of de-risking and the low interest rate environment. Insurance operating results declined 15.2% year-onyear, as the fourth quarter of 2011 benefi ted from a non-recurring expense reduction in the US. The fourth-quarter underlying result before tax of Insurance improved signifi cantly to EUR 272 million, refl ecting a lower net impact from market-related items relative to both comparable quarters.

Insurance sales (APE) rose 12.7% from the fourth quarter of 2011, on a constant currency basis. Sales at Insurance US grew 18.9%, fuelled by the Retirement business. Central and Rest of Europe recorded a 13.3% increase in APE, driven by higher Pension sales in Turkey and the Czech Republic. APE in the Benelux declined 18.6% due to lower sales of Individual Life products in the Netherlands and lower sales in Belgium following a reduction in guaranteed rates. Compared with the previous quarter, total Insurance APE jumped 23.6% at constant currencies, mainly attributable to higher sales at Insurance US and in Central and Rest of Europe.

ING Group's quarterly net profi t was EUR 1,434 million compared with EUR 1,186 million in the fourth quarter of 2011 and EUR 609 million in the third quarter.

Fourth-quarter net results included EUR 1,613 million of gains on divestments, of which EUR 1,135 million was attributable to ING Direct Canada, EUR 745 million to the sale of Insurance Malaysia and EUR -244 million to the announced sale of ING Direct UK. The net results from divested units was EUR 13 million and the net result from Insurance and Investment Management Asia, recorded under discontinued operations, totalled EUR 78 million. Special items after tax amounted to EUR -643 million and predominantly refl ect costs for various restructuring programmes. After-tax separation and IPO preparation costs were EUR 61 million in the quarter and EUR 169 million for the full year 2012.

ING Group's net profi t per share was EUR 0.38 for the fourth quarter and EUR 1.03 for the full year 2012. The Group's underlying net return on IFRS-EU equity was 5.2% for the full year 2012.

Subsequent Events

On 1 February 2013, the nationalisation of SNS Reaal, a Dutch fi nancial institution, was announced. As a consequence of the arrangements made by the Dutch government, ING Bank and other Dutch banks will be required to pay a one-time levy of EUR 1 billion in 2014. For ING, based on current limited information, this is estimated to result in a charge of EUR 300-350 million. ING will carefully assess further details on form, amount and timing of the levy as they become available. Furthermore, the Dutch Ministry of Finance has decided to postpone the introduction of the new Deposit Guarantee Scheme from 2013 to 2015.

BANKING

Banking key fi gures
	4Q2012	4Q2011	Change	3Q2012	Change	FY2012	FY2011	Change
Profi t and loss data (in EUR million)
Underlying interest result	2,866	3,046	-5.9%	2,981	-3.9%	11,712	11,975	-2.2%
Underlying income	3,172	3,341	-5.1%	3,736	-15.1%	14,241	14,289	-0.3%
Underlying operating expenses	2,400	2,231	7.6%	2,199	9.1%	8,900	8,824	0.9%
Underlying addition to loan loss provision	588	445	32.1%	554	6.1%	2,122	1,336	58.8%
Underlying result before tax	184	664	-72.3%	983	-81.3%	3,219	4,128	-22.0%
Key fi gures
Interest margin	1.33%	1.38%		1.34%		1.32%	1.38%
Underlying cost/income ratio	75.7%	66.8%		58.8%		62.5%	61.8%
Underlying risk costs in bp of average RWA	84	62		76		73	48
Risk-weighted assets (end of period, in EUR billion, adjusted for divestm.)				283	-1.5%	279	294	-5.1%
Underlying return on equity based on IFRS equity1	0.3%	5.7%		7.6%		5.9%	8.8%
Underlying return on equity based on 10% core Tier 12	0.7%	7.1%		10.0%		7.7%	10.9%

1 Annualised underlying net result divided by average IFRS-EU equity.

Annualised underlying, after-tax return divided by average equity based on 10% core Tier-1 ratio.

Challenging economic conditions and incidental items weighed on the Bank's fourth-quarter results. ING Bank posted an underlying result before tax of EUR 184 million, including EUR 188 million of negative CVA/DVA adjustments and a EUR 175 million charge for the Dutch bank tax. Excluding those and other marketrelated items, results declined 20.0% from a year ago, mainly due to higher risk costs, and were down 36.2% sequentially primarily due to seasonally lower activity in Financial Markets, higher liquidity costs, and lower results at Retail Banking. The underlying interest margin was largely unchanged at 1.33%. Excluding the Dutch bank tax, expenses were stable year-on-year and up 1.2% sequentially, refl ecting strong cost control. Risk costs remained elevated amid the weak economic environment.

Total underlying income decreased 5.1% year-on-year to EUR 3,172 million, primarily due to de-risking and the impact of CVA/ DVA adjustments. ING sold EUR 0.9 billion of mainly southern European debt securities, which led to EUR 126 million of derisking losses, but released EUR 1 billion of risk-weighted assets. CVA/DVA adjustments amounted to EUR -188 million compared with positive CVA/DVA adjustments of EUR 120 million one year ago. The year-ago quarter also included EUR 165 million of impairments (mainly on Greek government bonds) and EUR 109 million of de-risking losses. Excluding CVA/DVA and all marketrelated items, income was up 1.0%. On a sequential basis, total underlying income declined 15.1%, due in part to the thirdquarter EUR 323 million gain on the sale of ING's stake in Capital One. Excluding that impact, CVA/DVA adjustments and other market-related items, income decreased 8.2% quarter-on-quarter. This was primarily due to higher liquidity costs as the Bank lengthened its funding profi le (recorded within Bank Treasury), seasonality at Financial Markets, and lower margins on savings as interest rates declined. Furthermore, the third quarter of 2012 included the positive impact on the revaluation of derivatives used for hedging purposes at Bank Treasury.

INTEREST RESULT (in EUR million) AND INTEREST MARGIN (in %)

The underlying interest margin declined modestly to 1.33% from 1.34% in the third quarter of 2012, as a decrease in interest results was largely offset by the impact of a lower average balance sheet as a result of balance sheet optimisation. The interest result declined 5.9% from a year ago and 3.9% sequentially, primarily due to lower Financial Markets results, higher liquidity costs due to the lengthening of the funding profi le, and lower returns on the bond portfolio due to de-risking and declining interest rates. The interest result for lending activities improved versus both comparable quarters, supported by re-pricing and moderate volume growth in mortgages, which more than offset the impact of lower volumes in other lending. The interest result on savings declined, refl ecting lower returns from the investment portfolio, while client savings rates were kept largely unchanged in the quarter. ING continued to attract strong retail deposit infl ows in the fourth quarter, and rates were subsequently reduced in the Netherlands in early 2013.

The Bank continued to make progress on its Ambition 2015 priorities to optimise the balance sheet by growing customer deposits and focusing on loan growth with strong pricing discipline. The Bank generated EUR 8.2 billion of net funds entrusted infl ow during the quarter, including EUR 6.2 billion in Retail Banking and EUR 1.9 billion in Commercial Banking, mainly from higher corporate deposits. Despite a EUR 1.8 billion net production in mortgages, total net lending declined by EUR 2.5 billion, refl ecting moderate demand.

Stringent expense management remained a high priority at ING Bank. Nonetheless, operating expenses rose 7.6% from a year ago due to the EUR 175 million annual charge for the Dutch bank tax, which was introduced in 2012. Excluding this charge, operating expenses were stable, as lower impairments and strong cost control offset the impact of annual salary increases, higher costs related to other regulatory measures, and negative currency effects. On a sequential basis, expenses rose 1.2%, excluding the Dutch bank tax, mainly due to higher marketing costs in Retail Banking for year-end campaigns. The underlying cost/income ratio was 75.7%, or 63.4% excluding market impacts, the Dutch bank tax and CVA/DVA adjustments.

OPERATING EXPENSES (in EUR million) AND COST/INCOME RATIO (in %)

In November 2011, Retail Netherlands announced a strategic transformation programme to maintain its competitive position. Retail Netherlands is now entering a second phase of initiatives which will increase operational excellence primarily through the additional streamlining of IT systems, as well as further development and integration of our mobile banking offerings to adapt to changing customer preferences. These measures, combined with steps to respond to lower volumes and a leaner business environment in certain product areas, are expected to result in a further reduction of the workforce by around 1,400 FTEs (of which 400 external FTEs) over the next three years. Apart from these redundancies, about 250 new front-offi ce jobs will be created within Personal and Private Banking to maintain highquality customer service and attract liabilities. Approximately EUR 100 million of investments will be made over the next three years to support this second phase. An after-tax provision of EUR 111 million was recorded as a special item in the fourth quarter. Structural cost savings are expected to reach an annual run-rate of EUR 120 million from 2016 onwards. The fi rst phase of this programme, which is nearing completion, will lead to EUR 330 million of structural cost savings as of 2014. Combined, the two phases are already expected to generate EUR 430 million of annual cost savings in 2015.

ING Bank Belgium is also accelerating strategic projects aimed at further aligning its products and services with the new mobile banking environment. Customers in Belgium have been embracing new technologies faster than anticipated, leading to greater use of digital services and prompting further process automation. The shift to the digital banking channel is expected to reduce employment by approximately 1,000 FTEs by the end of 2015, through natural attrition, leading to EUR 150 million in annual cost savings by 2015.

Underlying risk costs remained elevated in the fourth quarter, consistent with the ongoing weak macroeconomic environment. ING Bank added EUR 588 million to the provision for loan losses, up from EUR 554 million in the previous quarter and EUR 445 million in the fourth quarter of 2011. The increase compared with the third quarter was fully attributable to Commercial Banking due to higher risk costs in Structured Finance, while risk costs at Real Estate Finance were relatively stable. Net additions to the loan loss provisions declined slightly at Retail International and remained elevated in Retail Benelux. Total non-performing loans at ING Bank rose in the fourth quarter by EUR 0.4 billion to EUR 14.9 billion. Total underlying risk costs were 84 basis points of average risk-weighted assets. ING expects risk costs to remain elevated, in line with the weak economic climate.

The underlying result before tax of Retail Banking declined to EUR 289 million in the fourth quarter of 2012 from EUR 329 million a year earlier. Results decreased due to lower margins on savings in the current low interest rate environment and from losses on selective de-risking of the investment portfolio to protect capital. Retail Banking continued to optimise its balance sheet: fourthquarter net production in funds entrusted was EUR 6.2 billion, the lending portfolio grew by EUR 1.8 billion, and another EUR 0.8 billion of European debt securities were sold at a loss of EUR 115 million. Risk costs remained elevated, but were down slightly from the third quarter, while operating expenses increased mainly due to higher marketing costs.

Commercial Banking results were heavily impacted by negative CVA/DVA adjustments as credit spreads contracted in the fourth quarter. The underlying result before tax declined to EUR 122 million, including a EUR 131 million negative impact from CVA/ DVA. Excluding that impact, results declined 2.7% year-on-year, due to higher risk costs. On a sequential basis, results excluding CVA/DVA fell 51.9%, refl ecting seasonality in Financial Markets, higher liquidity costs and positive revaluations of derivatives in the third quarter. Income in the core lending businesses held up well as lower volumes were offset by higher margins. Expenses remained under control, supported by lower impairments on real estate development projects.

The Corporate Line Banking posted an underlying result before tax of EUR -227 million, primarily refl ecting the EUR 175 million Dutch bank tax recorded in the current quarter.

ING Bank's quarterly net result was EUR 583 million, including the impact of divestments and special items. The sale of ING Direct Canada closed on 15 November 2012, resulting in a net transaction gain of EUR 1,135 million. ING Bank's underlying results for all prior quarters have been restated to refl ect this sale. A loss of EUR 244 million was booked in the fourth quarter for the announced sale of ING Direct UK, bringing the total expected after-tax loss for this transaction to EUR 260 million. Special items after tax amounted to EUR -348 million and mainly related to restructuring programmes and separation costs.

INSURANCE

Insurance key fi gures
	4Q2012	4Q2011	Change	3Q2012	Change	FY2012	FY2011	Change
Margin analysis (in EUR million)
Investment margin	447	413	8.2%	410	9.0%	1,757	1,660	5.8%
Fees and premium-based revenues	786	726	8.3%	784	0.3%	3,135	3,061	2.4%
Technical margin	118	118	0.0%	122	-3.3%	414	589	-29.7%
Income non-modelled life business	6	11	-45.5%	3	100.0%	20	45	-55.6%
Life & ING IM operating income	1,356	1,269	6.9%	1,319	2.8%	5,325	5,354	-0.5%
Administrative expenses	631	586	7.7%	628	0.5%	2,529	2,319	9.1%
DAC amortisation and trail commissions	323	288	12.2%	334	-3.3%	1,299	1,167	11.3%
Life & ING IM operating expenses	954	874	9.2%	962	-0.8%	3,827	3,485	9.8%
Life & ING IM operating result	402	394	2.0%	357	12.6%	1,498	1,869	-19.9%
Non-life operating result	39	38	2.6%	11	254.5%	89	184	-51.6%
Corporate line operating result	-146	-84		-131		-491	-394
Operating result	296	349	-15.2%	237	24.9%	1,095	1,658	-34.0%
Non-operating items	-24	-1,863		-193		-783	-1,984
Underlying result before tax	272	-1,513		44	518.2%	311	-325
Key fi gures
Administrative expenses / operating income (Life & ING IM)	46.5%	46.2%		47.6%		47.5%	43.3%
Life general account invested assets (end of period, in EUR billion)				133	-0.8%	132	133	-0.8%
Investment margin / life general account invested assets1 (in bps)	132	129		130
ING IM Assets under Management (end of period, in EUR billion)				316	1.6%	321	294	9.2%
Underlying return on equity based on IFRS-EU equity2	5.1%	-22.2%		-0.2%		1.8%	-1.1%

1 Four-quarter rolling average

2 Annualised underlying net result divided by average IFRS-EU equity

Operating results from Insurance improved from the third quarter, supported by a higher investment margin, as a release from the provision for profi t sharing in the Netherlands helped offset the impact of de-risking and low interest rates. The operating result rose 24.9% compared with the third quarter to EUR 296 million, but declined 15.2% from a year earlier, when earnings benefi ted from a EUR 45 million non-recurring expense reduction in the US. Underlying results improved sharply from the fourth-quarter of 2011, which included a charge for assumption changes in the US Closed Block VA and negative results on hedges to protect regulatory capital. Sales were up 12.7% year-on-year and up 23.6% sequentially (at constant currencies), mainly driven by strong Retirement sales in the US.

OPERATING RESULT (in EUR million)

The operating result from Life Insurance and Investment Management rose 2.0% from a year earlier to EUR 402 million as higher fees and premium-based revenues and a higher investment margin more than offset an increase in expenses. Compared with the third quarter of 2012, the operating result rose 12.6%, almost fully attributable to an increase in the investment margin.

The investment margin increased 8.2% from a year ago and 9.0% from the third quarter to EUR 447 million, refl ecting a release

from the provision for profi t sharing in the Netherlands, and growth in general account assets in the US Retirement business. These factors offset the effects of de-risking in the Benelux and the US and the impact of the low interest rate environment, which continue to put pressure on investment returns. The fourquarter rolling average investment spread strengthened to 132 basis points as the higher average investment margin outweighed the higher average Life general account invested assets.

Fees and premium-based revenues totalled EUR 786 million, up 5.5% excluding currency effects compared with the fourth quarter of 2011 and up 2.3% from the third quarter. The year-onyear increase was largely due to higher fees and premium-based revenues in the US, driven by the improvement in equity markets, higher infl ows in the Retirement business, and higher fees in Investment Management. On a sequential basis, the increase was mainly attributable to higher performance-related fees and higher infl ows at Investment Management US.

The technical margin was EUR 118 million, on par with the fourth quarter of 2011, as a decline in the Benelux from lower mortality and morbidity results and a one-off addition to unit-linked guarantee provisions was offset by an improvement in the US due to improved Individual Life mortality results and improved stop loss ratios in the Employee Benefi ts business. Compared with the third quarter of 2012, the technical margin declined 3.3%, refl ecting non-recurring reserve releases in the US Closed Block VA in the third quarter and lower mortality results in the Benelux in the current quarter.

Life & Investment Management administrative expenses rose 5.5% year-on-year, excluding currency effects, primarily due to a EUR 45 million non-recurring reduction in pension plan liabilities in the US in the fourth quarter of 2011. Expenses were lower in the Benelux and Central and Rest of Europe, refl ecting cost control and non-recurring expenses in the fourth quarter of 2011, offset by platform investments in ING Investment Management. Compared with the third quarter, administrative expenses were up 2.4%, driven by higher staff expenses in ING Investment Management, and restructuring costs. The ratio of administrative expenses to operating income was 46.5%.

ADMINISTRATIVE EXPENSES (in EUR million)

Administrative expenses / operating income ratio (%, Life & ING IM)

The operating result from Non-life insurance was stable at EUR 39 million, compared with EUR 38 million in the fourth quarter of 2011, which included EUR 24 million of positive non-recurring items. Lower claims in Property & Casualty (P&C) more than offset continued high claims experience in Disability & Accident amid the economic downturn in the Netherlands. Compared with the previous quarter, the Non-life operating result increased from EUR 11 million, mainly due to the lower claims in P&C.

The Corporate Line operating result was EUR -146 million compared with EUR -84 million in the fourth quarter of 2011. The decline was mainly due to higher Solvency II expenses and lower reinsurance results.

The fourth-quarter underlying result before tax of ING Insurance improved to EUR 272 million, including the impact of marketrelated items.

Gains/losses and impairments on investments in the quarter were EUR -5 million, including EUR 96 million of losses resulting from the sale of CMBS securities in Insurance US and Asset Backed Securities and real estate in the Benelux, as well as gains of EUR 97 million on the sale of equity investments, also in the Benelux. These sales refl ect ongoing efforts to reduce risk and optimise the capital positions in Europe and the US as both companies prepare for stand-alone futures.

Revaluations totalled EUR 26 million as EUR 72 million of positive CMO revaluations in Insurance US were partly offset by EUR 55 million of negative real estate revaluations in the Benelux.

Market and other impacts amounted to EUR -45 million. The Benelux recorded a EUR 166 million charge related to guarantees on separate account pension contracts (net of hedging). The current quarter also refl ects EUR 163 million of market and other impacts in US Closed Block VA, related to reserve changes and gains on hedges focused on protecting regulatory capital, as well as EUR -34 million in DAC amortisation in Insurance US.

The fourth-quarter net result for Insurance was EUR 851 million, including net gains on divestments of EUR 721 million as well as a EUR 78 million net result from Insurance and ING Investment Management Asia reported under discontinued operations. Net gains on divestments mainly related to a EUR 745 million realised gain on the sale of Insurance Malaysia and a EUR 15 million goodwill write-off for ING Vysya Life Insurance. Special items after tax amounted to EUR -295 million, primarily refl ecting EUR 172 million of net restructuring costs, of which EUR 149 million related to the accelerated transformation programme at Insurance Europe announced in the third quarter. Special items also included EUR 37 million of separation and IPO preparations costs and a EUR 49 million goodwill write-off for Insurance Benelux triggered by the annual impairment test. As a result, there is no remaining goodwill in Insurance Benelux.

Total new sales (APE) were up 12.7% year-on-year, on a constant currency basis. APE at Insurance US grew 18.9%, fuelled by higher Retirement sales, which offset lower Individual Life sales. APE in the Benelux fell 18.6% due to lower sales of Individual Life products in the Netherlands and lower sales in Belgium following a reduction in guaranteed rates. Central and Rest of Europe recorded a 13.3% increase in APE, driven by higher Pension sales in Turkey and the Czech Republic. On a sequential basis, total Insurance sales grew 23.6% at constant currencies, mainly due to higher Retirement sales at Insurance US, and higher Pension and Life sales in Central and Rest of Europe.

BALANCE SHEET AND CAPITAL MANAGEMENT

Balance Sheet and Capital Management key fi gures
	ING Group		ING Bank N.V.		ING Verzekeringen N.V.		Holdings/Eliminations
End of period, in EUR million	31 Dec. 12	30 Sep. 12	31 Dec. 12	30 Sep. 12	31 Dec. 12	30 Sep. 12	31 Dec. 12	30 Sep. 12
Balance sheet data
Financial assets at fair value through P&L	232,371	251,432	126,163	142,560	106,458	109,103	-250	-231
Investments	200,129	199,335	80,824	81,654	119,305	117,681
Loans and advances to customers	563,404	572,873	541,546	549,606	25,823	27,100	-3,965	-3,833
Other assets	104,256	120,741	80,754	96,998	26,586	31,733	-3,084	-7,990
Total assets excl. assets held for sale	1,100,160	1,144,381	829,287	870,818	278,172	285,617	-7,299	-12,053
Assets held for sale	68,472	103,714	6,781	38,316	61,691	65,398
Total assets	1,168,632	1,248,096	836,068	909,134	339,863	351,015	-7,299	-12,053
Shareholders' equity	54,357	52,877	36,669	37,602	27,299	26,570	-9,612	-11,295
Minority interests	1,081	1,020	843	795	217	203	21	22
Non-voting equity securities	2,250	3,000					2,250	3,000
Total equity	57,688	56,897	37,512	38,396	27,516	26,772	-7,340	-8,271
Debt securities in issue	143,436	159,961	134,689	150,577	1,910	2,192	6,837	7,192
Insurance and investment contracts	229,950	233,747			229,950	233,747
Customer deposits/other funds on deposit	455,003	444,955	460,362	454,162			-5,359	-9,208
Financial liabilities at fair value through P&L	115,803	136,291	112,971	133,277	3,258	3,464	-426	-450
Other liabilities	96,857	109,772	76,290	88,882	21,578	22,207	-1,011	-1,317
Total liabilities excl. liabilities held for sale	1,041,049	1,084,726	784,312	826,898	256,696	261,610	41	-3,782
Liabilities held for sale	69,895	106,473	14,244	43,840	55,651	62,633
Total liabilities	1,110,944	1,191,199	798,556	870,738	312,347	324,243	41	-3,782
Total equity and liabilities	1,168,632	1,248,096	836,068	909,134	339,863	351,015	-7,299	-12,053
Captal ratios (end of period)
ING Group debt/equity ratio	11.1%	12.3%
Bank core Tier 1 ratio			11.9%	12.1%
Insurance IGD Solvency ratio					245%	249%

ING Group's balance sheet decreased by EUR 79 billion to EUR 1,169 billion in the fourth quarter, or by EUR 68 billion excluding currency effects. Assets held for sale decreased by EUR 35 billion, refl ecting the sale of ING Direct Canada and Insurance Malaysia. The remainder of the decrease was due to a reduction of shortterm professional funding and seasonally lower positions at Financial Markets as the Bank continues to focus on balance sheet integration. Shareholders' equity rose to EUR 54.4 billion (or EUR 14.30 per share), mainly due to the quarterly net profi t.

ING Bank's core Tier 1 ratio remained strong at 11.9%, supported by the gain from the sale of ING Direct Canada, which helped to partially fund a dividend upstream of EUR 2.125 billion to the Group. This was used to pay EUR 1.125 billion to the Dutch State and to reduce core debt in the Group holding company by EUR 1 billion to EUR 7 billion. Total risk-weighted assets at the Bank fell by EUR 8 billion in the quarter, including EUR 2 billion of negative currency impacts, primarily due to the sale of ING Direct Canada, lower lending volumes and de-risking in the investment portfolio.

In the fourth quarter, ING Bank issued EUR 6.7 billion of long-term debt. In the full-year 2012, ING Bank issued EUR 33.1 billion of debt with a tenor of more than one year compared with EUR 18 billion of long-term debt maturing in the whole of 2012, successfully covering its 2012 funding needs and pre-funding 2013 requirements. ING Bank has EUR 20.7 billion of debt with a tenor of more than one year maturing in 2013.

The Insurance Group Directive ratio (IGD) declined to 245% following the redemption of a EUR 1.25 billion hybrid security by ING Verzekeringen N.V. in December 2012. The IGD ratio was also impacted by a deterioration of the solvency position at Nationale-Nederlanden Life resulting from updated mortality assumptions and the impact of market developments. These factors were offset by the sale of Insurance Malaysia.

On 1 January 2013, the revised IAS 19 on pensions came into effect, requiring immediate recognition of 'unrecognised actuarial gains and losses' through equity. The impact on ING Group's capital would be approximately EUR -1.7 billion at Bank and EUR -0.9 billion at Insurance. The Bank's core Tier 1 ratio would decline from 11.9% to 11.3%; however, this 60 basis point impact was already refl ected in ING's expected Basel III impact, which will phase out net pension assets from capital calculations over time. The IGD ratio for Insurance would decline from 245% to 236%. The proforma Group debt/equity ratio would rise from 11.1% to 11.6%. However, it is still uncertain whether this full effect will be refl ected immediately in capital ratios as discussions with regulatory authorities on transitioning are ongoing. The recognition of 'unrecognised actuarial gains and losses' through equity will create volatility in equity and capital going forward.

Dividend

Given the uncertain fi nancial environment, increasing regulatory requirements and ING's priority to repurchase the remaining outstanding core Tier 1 securities, the Executive Board will not propose to pay a dividend over 2012 at the AGM in May. ING intends to resume dividend payments on common shares when all remaining core Tier 1 securities have been repaid to the Dutch State and regulatory capital requirements have been met.

BUSINESS AND SUSTAINABILITY HIGHLIGHTS

Customer preferences and habits are changing, and the demands on the fi nancial industry from regulators, customers, shareholders and society at large are increasing. ING recognises the importance of these trends and has initiatives focused on customer centricity, operational excellence and sustainability at the core of its strategy.

Improving the customer experience

Seeking direct input and feedback from customers in an open dialogue is vital in order to keep up with today's consumer trends and preferences. Social media is an increasingly important channel for engaging with customers. Our activities on social media were recognised in the fourth quarter of 2012 when ING Netherlands was named the number one social media brand in the Netherlands by Social Embassy. ING was cited by the jury as being one of the few banks that knows how to foster constructive interaction on social media about fi nancial products and services.

In January 2013, ING Bank Slaski in Poland introduced ING BusinessMobile, a mobile app to help corporate clients manage their funds in a secure and convenient environment, including signing and sending orders via ING´s internet banking system. A similar app is already in use at ING Netherlands and ING Belgium.

Another way ING is improving the customer experience is by encouraging customers to improve their fi nancial knowledge. ING Insurance Europe launched an online 'fi nancial personality' test in seven European countries, that is helping consumers become more aware of their fi nancial behavior. This tool is available free of charge to the general public.

Tailored insurance offerings

ING Insurance Czech Republic launched a new product designed especially for women. 'For You' offers women not only fi nancial support in case of a cancer diagnosis, but also a community platform where women can learn about prevention and treatment, share their experiences and discuss their concerns with medical professionals. 'For You' is a key project for Insurance Central and Rest of Europe. If this pilot is successful in the Czech Republic, it will be introduced in other European countries.

Customer and quality awards

In the Netherlands, Nationale-Nederlanden won fi rst place for Pensions and second place for Insurance in a well-known annual survey by Management Team, a Dutch business magazine, which gauges companies' level of satisfaction with their fi nancial service providers. In Slovakia, ING Insurance was awarded fi rst place in the Golden Coin Competition 2012 for its unit-linked life insurance product 'ING Smart' (in the category 'public poll'). In the same competition, 'ING Smart Senior', a product designed for people aged 55 and over, was named 'Newcomer of the Year'.

ING in society

ING's sustainability approach focuses on achieving long-term business success for both ING and its clients while contributing towards economic development, a healthy environment and a stable society. During the fourth quarter, ING made further progress in embedding sustainability into its business activities.

ING Sustainable Procurement Programme

In 2012, ING initiated its Sustainable Procurement Programme in order to fully integrate sustainability into the procurement process. This is an important step in translating our ambitions into tangible guidelines. As a signatory to the UN Global Compact (UNGC), ING has asked its suppliers to comply with the UNGC principles, which promote human rights, fair labour practices, environmental protection and anti-corruption.

Celebrating 12½ years of sustainable investments

The ING Sustainable Investment team, part of ING Private Banking in the Netherlands, recently celebrated its 12½-year anniversary. The ING Sustainable Investments strategy focuses on the economic implications of sustainable development from the perspectives of risk reduction and emerging opportunities. It also tries to identify investment opportunities that relate to important sustainability issues such as scarcity of raw materials and water, talent retention and renewable energy.

Unlocking potential value by identifying opportunities and/or risks through the use of environmental, social and governance indicators is also a strength of ING Investment Management (ING IM). In 2012, the assets under management of ING IM's Sustainable Equity Strategy tripled compared with year-end 2011 to EUR 837 million, driven by its consistent investment approach and solid performance record.

ING Global Challenge 2012

In 2012, ING held its Global Challenge for the fi fth straight year. This annual fl agship event, which takes place around the United Nations' Universal Children's Day on 20 November, encourages ING employees all over the globe to rise to the challenge of supporting disadvantaged children and families. During the 2012 Global Challenge, ING employees raised over EUR 500,000 for projects aimed at children's education and welfare as well as other good causes. Money and awareness were raised through a variety of volunteer and fundraising activities that are as diverse as ING's employee base. Activities included a fi tness challenge in Australia, a book donation programme in Poland, and a thank-a-thon in the Netherlands through which 4,500 UNICEF pledge donors received a personal telephone call to thank them for their support.

In partnership with UNICEF, ING's overall aim is to have positively impacted the lives of at least one million children in need by 2015, by providing access to schools, better quality education and safer and healthier living conditions.

APPENDIX 1 ING GROUP: CONSOLIDATED PROFIT AND LOSS ACCOUNT

l i da d p f i t d los ING G : C te t rou p on so ro an s a cco un
	al G Tot	1 rou p	al B Tot	ank ing	al In Tot sura nce
mill in E UR ion	4Q 201 2	4Q 201 1	4Q 201 2	4Q 201 1	4Q 201 2	4Q 201 1
Gro ium inc ss p rem om e	4,6 61	4,7 50			4,6 61	4,7 50
ult king Inte Ban tion rest res op era s	2,8 41	3,0 41	2,8 66	3,0 46
Com mis sion inc om e	878	845	509	490	369	355
al in oth Tot nt & er i tme ves nco me	1,2 32	490	-20 3	-19 5	1,4 44	718
al u nde rly ing inc Tot om e	9,6 12	9,1 27	3,1 72	3,3 41	6,4 75	5,8 24
Und ritin ditu erw g ex pen re	5,2 58	6,4 01			5,2 58	6,4 01
Staf f ex pen ses	1,74 9	1,6 27	1,2 57	1,2 24	491	403
Oth er e xpe nse s	1,44 8	1,2 73	1,1 08	885	341	387
ible orti sati and im irm Inta ent ng s am on pa s	35	122	35	122
rati Ope ng exp ens es	3,2 32	3,0 21	2,4 00	2,2 31	832	790
atio Inte rest es I exp ens nsu ran ce o per ns	74	105			108	143
Add itio loa n lo isio n to ss p rov ns	588	445	588	445
Oth er	5	3			5	3
al u nde rly ing dit Tot ex pen ure	9,1 57	9,9 76	2,9 88	2,6 76	6,2 03	7,3 37
Und erly ing ult bef tax res ore	455	-84 9	184	664	272	13 -1,5
atio Tax n	66	-94	133	153	-67	-24 7
Min orit inte rest y s	17	30	20	22	-3	8
Und erly ing sul t re t ne	373	-78 5	31	489	342	-1,2 74
Net ins/ loss n d ives tme nts ga es o	1,6 13	1,2 61	891	265	721	996
from Net ult div d u nits este res	13	71	8	71	5
from Net ult dis tinu ed bus ines s2 res con	78	232			78	232
afte Spe cial ite r ta ms x	-64 3	407	-34 8	428	-29 5	-21
Net ult res	1,4 34	1,1 86	583	1,2 53	851	-68

1 Including intercompany eliminations

2 The results of Insurance/IM Asia (2012 and 2011 periods) and Insurance Latin America (2011 periods) have been transferred to "net result from discontinued operations".

l da d ba lan he ING G : C i te et rou p on so ce s
		ING Gr oup			nk ING Ba NV		ING	rzek erin Ve gen	NV	Ho	ldin /eli min atio gs ns
in E UR mill ion	31 Dec . 12	30 Sep . 12	31 Dec . 11 for 1 pro ma	31 Dec . 12	30 Sep . 12	31 Dec . 11 for 1 pro ma	31 Dec . 12	30 Sep . 12	31 Dec . 11 for 1 pro ma	31 Dec . 12	30 Sep . 12	31 Dec . 11 for 1 pro ma
Ass ets
h a nd bala ith tral ba nks Cas nce s w cen	17, 657	28, 367	29, 869	15, 447	26, 164	28, 095	5,3 89	10, 352	10, 269	-3, 179	-8, 149	-8,4 95
ts d ue f ba nks Am oun rom	39, 053	44, 788	43, 795	39, 053	44, 789	43, 795
Fina ncia l as fair lue thro h P sets at &L va ug	232 ,37 1	251 ,43 2	238 ,64 5	126 ,16 3	142 ,56 0	136 ,01 0	106 ,45 8	109 ,10 3	102 ,87 5	-25 0	-23 1	-24 0
Inve stm ent s	200 ,12 9	199 ,33 5	189 ,44 9	80, 824	81, 654	79, 920	119 ,30 5	117 ,68 1	109 ,52 9
nd adv Loa es t usto ns a anc o c me rs	563 ,40 4	572 ,87 3	570 ,34 6	541 ,54 6	549 ,60 6	547 ,72 9	25, 823	27, 100	30, 590	-3,9 65	-3,8 33	-7,9 73
Rein ntra cts sura nce co	5,2 91	61 5,4	5,8 03				5,2 90	61 5,4	5,8 03
s in ocia Inve stm ent tes ass	2,2 03	2,2 35	2,0 33	841	846	827	1,3 52	1,3 63	89 1,1	10	26	17
Rea l es inv tate estm ent s	1,2 88	1,3 39	1,5 86	207	246	435	805	816	869	276	277	282
Pro nd ipm ty a ent per equ	2,6 74	2,6 89	2,7 94	2,3 36	2,3 30	2,3 93	338	358	401
Inta ible ets ng ass	2,6 39	2,7 07	2,9 03	1,7 78	1,7 88	1,7 04	1,0 18	1,0 84	1,3 56	-15 7	-16 5	-15 7
Def d a isiti ts erre cqu on cos	4,5 49	4,6 34	4,6 35				4,5 49	4,6 34	4,6 35
Oth sset er a s	28, 903	28, 523	29, 215	21, 092	20, 835	22, 150	7,8 45	7,6 65	7,8 22	-34	23	-75 7
fo Tot al a xcl s h eld le ts e set sse . as r sa	1,1 00, 160	1,1 44, 381	1,1 21, 073	829 ,28 7	870 ,81 8	863 ,05 9	278 ,17 2	285 ,61 7	275 ,33 6	-7,2 99	-12 ,05 3	-17 ,32 2
for Ass held sal ets e	68, 472	103 ,71 4	158 ,15 7	6,7 81	38, 316	98, 106	61, 691	65, 398	60, 051
al a Tot ts sse	1,1 68, 632	1,2 48, 096	1,2 79, 228	836 ,06 8	909 ,13 4	961 ,16 5	339 ,86 3	351 ,01 5	335 ,38 7	-7,2 99	-12 ,05 3	-17 ,32 4
Equ ity
Sha reh old uity ers' eq	54, 357	52, 877	46, 662	36, 669	37, 602	34, 367	27, 299	26, 570	23, 475	-9,6 12	-11 ,29 5	-11 ,18 0
Min orit inte rest y s	1,0 81	1,0 20	777	843	795	693	217	203	62	21	22	22
ting uity urit ies Non -vo eq sec	2,2 50	3,0 00	3,0 00							2,2 50	3,0 00	3,0 00
al e ity Tot qu	688 57,	56, 897	50, 439	37, 512	38, 396	35, 060	27, 516	26, 772	23, 537	-7,3 40	-8,2 71	-8,1 58
Lia bili ties
Sub ord inat ed loan s	8,7 86	8,9 38	8,6 15	16, 407	16, 658	18, 165	2,9 47	4,2 36	4,3 67	-10 ,56 8	-11 ,95 6	-13 ,91 7
Deb ities in issu t se cur e	143 ,43 6	159 ,96 1	139 ,86 2	134 ,68 9	150 ,57 7	130 ,92 6	1,9 10	2,1 92	3,4 35	6,8 37	7,1 92	5,5 01
Oth er b d fu nds orro we	16, 723	18, 060	19, 318				7,4 42	7,7 34	6,9 40	9,2 81	10, 326	12, 378
nd inve Insu stm ent ntra cts ran ce a co	229 ,95 0	233 ,74 7	225 ,07 5				229 ,95 0	233 ,74 7	225 ,07 5
ts d o b ank Am ue t oun s	38, 704	51, 367	72, 190	38, 704	51, 367	72, 190
er d sits d o the r fu nds de its Cus tom epo an on pos	455 ,00 3	444 ,95 4	425 ,82 4	460 ,36 2	454 ,16 2	437 ,64 1				-5,3 59	-9,2 08	-11 ,81 7
Fina ncia l lia bilit ies at f air valu e th h P &L rou g	115 ,80 3	136 ,29 1	142 ,37 5	112 ,97 1	133 ,27 7	138 ,39 9	3,2 58	3,4 64	4,3 76	-42 6	-45 0	-40 0
Oth er l iabi litie s	32, 644	31, 408	31, 391	21, 179	20, 857	21, 948	11, 189	10, 237	10, 353	276	314	-91 0
al l iab iliti xcl . lia bili ties he ld f ale Tot es e or s	1,0 049 41,	1,0 84, 726	1,0 64, 650	784 ,31 2	826 ,89 8	819 ,26 9	256 ,69 6	261 ,61 0	254 ,54 7	41	-3,7 82	-9,1 66
Liab ilitie s he ld f ale or s	69, 895	106 3 ,47	164 ,13 9	244 14,	43, 840	106 ,83 6	651 55,	62, 633	303 57,
Tot al l iab iliti es	1,1 10, 944	1,1 91, 199	1,2 28, 789	798 ,55 6	870 ,73 8	926 ,10 5	312 ,34 7	324 ,24 3	311 ,85 0	41	-3,7 82	-9,1 66
Tot al e ity and lia bili ties qu	1,1 68, 632	1,2 48, 096	1,2 79, 228	836 ,06 8	909 ,13 4	961 ,16 5	339 ,86 3	351 ,01 5	335 ,38 7	-7,2 99	-12 ,05 3	-17 ,32 4

1 Adjusted for transfer of ING Direct Canada, ING Direct UK and Insurance/IM Asia to assets/liabilities held for sale

i l B k ing l i da d p f i t d los Re : C ta te t an on so ro an s a cco un
				ail B ank Ret	ing elux Ben			ail I tion al Ret nte rna
	al R Tot eta	il Ba nkin g	her land Bel Net s g		ium	Ge rma	Res ny		t of rld Wo
in E UR mill ion	4Q 201 2	4Q 201 1	4Q 201 2	4Q 201 1	4Q 201 2	4Q 201 1	4Q 201 2	4Q 201 1	4Q 201 2	4Q 201 1
ult Inte rest res	1,9 96	2,0 61	828	896	437	412	285	292	446	460
Com mis sion inc om e	297	299	117	124	76	78	20	24	83	73
Inve inc stm ent om e	3	-12 7	0	0	-3	-7	0	-49	5	-71
Oth er i nco me	-81	-31	4	11	24	29	-19	-67	-90	-4
al u nde rly ing inc Tot om e	2,2 14	2,2 01	950	1,0 31	534	512	286	201	444	457
Staf f an d o the r ex pen ses	1,6 06	1,5 61	611	600	365	361	174	174	455	426
ible orti sati and im irm Inta ent ng s am on pa s	6	27	1	21	5	5	0	0	0	1
rati Ope ng exp ens es	1,6 12	1,5 88	612	621	370	366	174	174	456	427
lt Gro ss r esu	602	614	338	411	164	145	112	27	-11	31
Add itio loa n lo isio n to ss p rov n	313	285	193	191	42	42	26	11	53	41
Und erly ing ult bef tax res ore	289	329	145	220	122	104	86	15	-64	-10
Clie nt b ala s (i bill ion )1 n E UR nce
iden tial Res Mo rtga ges	292 .6	283 .2	143 .6	141 .8	30. 6	28. 9	59. 9	56. 5	58. 5	55. 9
Oth end ing er L	94. 5	91. 7	38. 5	41. 5	33. 2	30. 7	3.9	3.3	18. 9	16. 2
ds E sted Fun ntru	394 .7	368 .8	115 .8	106 .7	74. 6	71. 3	96. 7	87. 6	107 .7	103 .3
M/M al F und AU utu s	56. 3	53. 5	16. 0	2 15.	27. 3	26. 1	6.1	5.7	6.9	6.5
fi ta bili nd effi cie 1 Pro ty a ncy
Cos t/in tio com e ra	72. 8%	72. 1%	64. 4%	60. 2%	69. 3%	71. 6%	60. 9%	86. 7%	102 .6%	93. 3%
Ret uity ba sed 10 .0% re T ier 12 urn on eq on co	4.4 %	7.3 %	8.6 %	13. 4%	18. 0%	18. 1%	9.1 %	3.4 %	-6.7 %	-0.7 %
Ris k1
f av Risk in b RW A sts co p o era ge	86	80	153	155	82	86	46	22	40	31
of p Risk ig hte d a s (e nd erio d) sset -we	146 ,33 3	142 ,52 5	50, 865	49, 348	20, 119	20, 049	22, 605	20, 591	52, 744	52, 536

1 Key fi gures based on underlying fi gures

2 Underlying after-tax return divided by average equity based on 10.0% core Tier 1 ratio (annualised)

Commercial Banking: Consolidated profi t and loss account Total Commercial Banking Industry Lending General Lending & Transaction Services Financial MarketsBank Treasury, Real Estate & Otherin EUR million 4Q2012 4Q2011 4Q2012 4Q2011 4Q2012 4Q2011 4Q2012 4Q2011 4Q2012 4Q2011 Profit & lossInterest result 789 974 393 394 266 262 144 182 -14 136Commission income 205 197 104 115 94 82 8 -7 -1 7Investment income 10 -15 5 -12 0 0 0 0 5 -3Other income excl. CVA/DVA 127 -106 -13 -1 6 5 74 43 61 -153Underlying income excl. CVA/DVA 1,130 1,050 488 496 365 350 225 217 52 -13 Other income - DVA on structured notes -50 53 -50 53 Other income - CVA/DVA on derivatives -81 64 -81 64 Total underlying income 999 1,166 488 496 365 350 94 333 52 -13 Staff and other expenses 581 573 116 105 184 173 210 223 71 73 Intangibles amortisation and impairments 22 56 4 0 0 0 1 1 17 55 Operating expenses 603 629 120 105 184 173 211 224 88 128 Gross result 397 537 368 392 181 177 -116 109 -36 -141Addition to loan loss provision 275 161 219 83 20 42 1 -1 35 36 Underlying result before tax 122 376 150 308 160 136 -117 110 -71 -177 Client balances (in EUR billion)1 Residential Mortgages Other Lending 125.7 137.3 74.4 77.8 38.8 44.7 2.0 2.8 10.5 12.0 Funds Entrusted 68.0 66.4 1.8 1.6 34.4 33.8 3.9 3.2 27.9 27.7 AUM/Mutual Funds 0.2 0.4 0.0 0.0 0.0 0.0 0.0 0.0 0.2 0.4Profi tability and effi ciency1 Cost/income ratio 60.3% 54.0% 24.5% 21.1% 50.5% 49.4% 222.9% 67.3% 170.8% n.a. Return on equity based on 10.0% core Tier 12 2.4% 7.8% 13.0% 20.8% 13.3% 11.0% -9.7% 13.1% -39.5% -48.5% Risk1 Risk costs in bp of average RWA 87 46 202 73 20 37 1 -1 108 89

Risk-weighted assets (end of period) 123,725 145,190 43,701 46,198 38,735 44,424 29,597 38,610 11,693 15,958

1 Key fi gures based on underlying fi gures

2 Underlying after-tax return divided by average equity based on 10.0% core Tier 1 ratio (annualised)

in ly is a d ke f i g Ins Ma ura nc e: rg an a s n y ure s
	ING Ins ura nce		elux Ben		Cen t of Res	tral & Eu rop e	ited Un	Sta tes		Clo sed Blo ck V US A		IM	Co rate rpo	Lin e
In E UR mill ion	4Q 201 2	4Q 201 1	4Q 201 2	4Q 201 1	4Q 201 2	4Q 201 1	4Q 201 2	4Q 201 1	4Q 201 2	4Q 201 1	ING 4Q 201 2	4Q 201 1	4Q 201 2	4Q 201 1
in Inve stm ent ma rg	44 7	413	163	144	20	20	261	233	5	14	-1	2
d p -ba sed Fee ium s an rem rev enu es	78 6	726	139	132	106	110	297	277	29	11	215	196
hni cal Tec in ma rg	11 8	118	40	56	42	36	34	17	1	10	-	-
del led life bus Inco ines me non -mo s	6	11	0	9	6	2	-0	0	-0	-0	0	0
Life tin inc & ING IM op era g om e	1,3 56	1,2 69	343	341	173	168	591	527	36	35	214	198
Adm inis ive trat exp ens es	63 1	586	147	169	63	83	221	174	24	20	177	140
d tr ail c DA C a rtisa tion mis sion mo an om s	32 3	288	46	50	56	51	181	164	39	22	0	1
Life & ING IM ex pen ses	95 4	874	194	218	119	134	402	339	63	42	177	141
Life tin sul & ING IM t op era g re	40 2	394	149	122	54	34	190	188	-27	-7	37	57
-life ting ult Non op era res	39	38	38	37	2	1	-	-	-	-	-	-
Line ting ult Cor ate por op era res	-14 6	-84											-14 6	-84
tin sul Op t era g re	29 6	349	186	160	56	35	190	188	-27	-7	37	57	-14 6	-84
Gai ns/l nd imp airm ent oss es a s	-5	-9	24	173	-0	-12 7	-28	-50	-0	0	0	0	-0	-5
alua tion Rev s	26	-28 0	-34	-18 4	0	-1	72	-65	1	-2	-0	-7	-12	-21
rket & o the r im Ma ts pac	-45	-1,5 74	-16 9	-24 7	-1	-	-39	32	163	-1,3 60	-0	-	-0	-
Und erly ing ult bef tax res ore	27 2	13 -1,5	8	-98	55	-93	195	105	136	-1,3 68	36	51	8 -15	0 -11
Life bu sin fi g Ins - N ura nce ew ess ure s
Sing le p ium rem s	3,6 66	2,6 98	469	491	153	233	3,0 44	1,9 74	-	-	-	-	-	-
Ann ual miu pre ms	38 7	379	33	48	103	77	251	254	-	-	-	-	-	-
New sal es ( APE )	75 3	649	79	97	119	101	555	451	-	-	-	-	-	-
Key fi g ure s
Gro ium inc ss p rem om e	4,6 61	4,7 50	1,0 78	1,2 62	490	557	2,9 87	2,8 08	103	115	-	-	3	8
ife Adm / op ting inc e (L & IN G IM ) . ex pen ses era om	46. 5%	46. 2%	42. 9%	49. 6%	36. 4%	49. 4%	37. 4%	33. 0%	66. 7%	57. 1%	82. 7%	70. 7%
Life s (e of p on) al a inv d a nd erio d, i n E UR billi unt este sset ge ner cco	13 2	133	60	59	7	7	60	63	5	5	-	-	-	-
Life s (in s)1 Inve in / al a inv d a bp stm ent unt este sset ma rg ge ner cco	13 2	129	101	114	83	96	177	153	15	58	-	-
n fo r lif for risk licy hol der (en d o f pe riod ) Prov isio e in & inve stm ntra cts sura nce . co po	98 ,87 0	116 ,56 32	23 ,15 5	22, 208	3,8 68	3,4 01	40, 032	36, 412	31, 814	32, 115	-	-	-	-
duc clie nt b alan (in bil lion ) Net tion EUR pro ces	6.0	-3.0	-0.6	-1.1	0.1	0.2	0.4	-0.3	-0.7	-0.6	6.8	-1.2	-	-
Clie nt b alan (en d o f pe riod bil lion ) , in EUR ces	36 4.2	336 .8	70. 9	69. 6	30. 1	25. 0	102 .1	98. 0	32. 8	32. 9	128 .4	111 .2	-	-
Adm es ( l) inis ive trat tota exp ens	78 9	738	243	271	64	85	221	174	24	20	177	140	60	47

1 Four-quarter rolling average

2 4Q2011 includes EUR 22,427 million for Asia/Pacifi c

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Press conference, Investor conference call and webcast

Jan Hommen, Patrick Flynn and Wilfred Nagel will discuss the results in a press conference on 13 February 2013 at 09:00 a.m. CET. Journalists are invited to join the conference at ING Amsterdamse Poort, Bijlmerplein 888, Amsterdam. Journalists can also join in listen-only mode at +31 20 531 5846 (NL) or +44 203 365 3210 (UK) and via live audio webcast at www.ing.com.

DISCLAIMER

ING Group's Annual Accounts are prepared in accordance with International Financial Reporting Standards as adopted by the European Union ('IFRS-EU').

In preparing the fi nancial information in this document, the same accounting principles are applied as in the 2011 ING Group Annual Accounts. The Financial statements for 2012 are in progress and may be subject to adjustments from subsequent events. All fi gures in this document are unaudited. Small differences are possible in the tables due to rounding.

Certain of the statements contained herein are not historical facts, including, without limitation, certain statements made of future expectations and other forward-looking statements that are based on management's current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Actual results, performance or events may differ materially from those in such statements due to, without limitation: (1) changes in general economic conditions, in particular economic conditions in ING's core markets, (2) changes in performance of fi nancial markets, including developing markets, (3) consequences of a potential (partial) break-up of the euro, (4) the implementation of ING's restructuring plan to separate banking and insurance

Additional information is available in the following documents on www.ing.com:

• ING Group Quarterly Report
• ING Group Statistical Supplement
• ING Group Historical Trend Data
• ING Group Analyst Presentation

Jan Hommen, Patrick Flynn and Wilfred Nagel will also discuss the results in an analyst and investor conference call on 13 February 2013 at 10:30 a.m. CET. Members of the investment community can join the conference call at +31 20 794 8500 (NL), +44 207 190 1537 (UK) or +1 480 629 9031 (US) and via live audio webcast at www.ing.com.

operations, (5) changes in the availability of, and costs associated with, sources of liquidity such as interbank funding, as well as conditions in the credit markets generally, including changes in borrower and counterparty creditworthiness, (6) the frequency and severity of insured loss events, (7) changes affecting mortality and morbidity levels and trends, (8) changes affecting persistency levels, (9) changes affecting interest rate levels, (10) changes affecting currency exchange rates, (11) changes in investor, customer and policyholder behaviour, (12) changes in general competitive factors, (13) changes in laws and regulations, (14) changes in the policies of governments and/or regulatory authorities, (15) conclusions with regard to purchase accounting assumptions and methodologies, (16) changes in ownership that could affect the future availability to us of net operating loss, net capital and built-in loss carry forwards, (17) changes in credit-ratings, (18) ING's ability to achieve projected operational synergies and (19) the other risks and uncertainties detailed in the Risk Factors section contained in the most recent annual report of ING Groep N.V. Any forward-looking statements made by or on behalf of ING speak only as of the date they are made, and, ING assumes no obligation to publicly update or revise any forwardlooking statements, whether as a result of new information or for any other reason. This document does not constitute an offer to sell, or a solicitation of an offer to buy, any securities.

Notes from the front page table:

¹ The results of Insurance/IM Asia (2012 and 2011 periods) and Insurance Latin America (2011 periods) have been transferred to "net result from discontinued operations". 2

Result per share differs from IFRS earnings per share in respect of attributions to the core Tier 1 securities. 3

Annualised underlying net result divided by average IFRS-EU equity. 4 Four quarter rolling average.

Note: Underlying fi gures are non-GAAP measures and are derived from fi gures according to IFRS-EU by excluding impact from divestments, discontinued operations and special items.