ING Group, the Netherlands-based international banking, financial services and insurance company, posted strong results for 2005 with net profits up 25.3 percent to €7.21 billion ($8.56 billion).
Other earnings highlights reported by the company included the following:
— Earnings per share increase 22.7 percent from €2.71 to €3.32 [$3.218 to $3.942]
— Underlying profit before tax increases 19.4 percent to €8.506 billion [$10.1 billion]
— Strong top-line growth: underlying bank income +11.4 percent, life premiums +12.5 percent
— Focus on value leads to higher returns: RAROC 18.8 percent after tax, IRR 13.2 percent
— Embedded value of life business rises 22.9 percent to €27.586 billion [$32.75 billion] Efficiency improves due to sharpened focus on execution across the Group
— Total dividend proposed at €1.18 per share, up 10.3 percent from €1.07 in 2004 [$1.40 from $1.27].
“ING produced strong results in 2005, driven by double-digit top-line growth, higher returns, and an improvement in the efficiency ratios for both banking and insurance,” commented Michel Tilmant, Chairman of the Executive Board.
“We have focused on creating value for shareholders through a stringent approach to capital allocation, investing for growth, improving execution and increasing returns at all of our businesses,” he continued. “Our results provide evidence that we are delivering on those objectives and that our strategy is paying off. Returns have increased in both banking and insurance, with all business lines performing above ING’s hurdles. ING’s three key growth engines – ING Direct, retirement services, and life insurance in developing markets – continued their strong performance, while the banking businesses in the Benelux also made a solid contribution to growth. We took important steps to improve efficiency going forward, and recurring expenses remained under control in 2005.”
ING’s 2005 pretax profits from its insurance operations in North and South America rose 23.6 percent to €1.979 billion ($2.35 billion) from €1.601 billion ($1.9 billion). The earnings bulletin noted: “Underlying profit from insurance in the U.S. increased 27.4 percent, led by higher results from retirement services and annuities due to growth in assets, improved investment performance, and higher margins as the company continued to focus on the most attractive market segments. The Canadian non-life business posted a 35.8 percent increase in underlying profit before tax, supported by a favorable claims environment and the acquisition of Allianz Canada. Growth was moderated by lower results from Latin America, due in part to an active hurricane season in Mexico in the second half of 2005.”
The full report, as well as the accompanying press conference discussing the results, may be obtained on the Group’s Website at: www.ing.com.
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