ING Groep N.V. (ING) Q3 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call summary presents a mixed outlook. Basic financial performance and expenses show stability, but the lack of clear guidance and reliance on future updates creates uncertainty. Product development and market strategy have potential with AI initiatives, yet the absence of immediate implementation limits positivity. Shareholder return plans are not explicitly outlined, and while Wholesale Banking growth is positive, flat deposit growth and unclear management responses temper enthusiasm. Overall, the sentiment is neutral due to balanced positives and negatives, with no strong catalysts for significant stock movement.
Key Financial Performance
Mobile Primary Customers Added nearly 200,000 during the quarter, bringing growth in the last 12 months to over EUR 1.1 million. This growth is well ahead of the target set at the Capital Markets Day.
Net Core Lending Growth (Retail) EUR 8.6 billion, driven mainly by residential mortgages.
Net Core Lending Growth (Wholesale Banking) EUR 14.2 billion, supported by trade finance services and lending, reflecting increased client financing needs.
Core Deposits Declined by around EUR 200 million, largely due to the conclusion of promotional campaigns and seasonal spending patterns during the summer in Retail Banking.
Customer Balances Grew at an annualized rate of 7% in the first 9 months of 2025, keeping on track to achieve the 4% annual growth target.
Fee Income Grew by 15% year-on-year, with a year-to-date growth of 12%. Growth was driven by structural revenue drivers across both Retail and Wholesale Banking, including a rise in mobile primary customers, investment products, and lending activities.
Return on Equity (ROE) Fourth quarter rolling average stands at 12.6%, with a revised full-year outlook of more than 12.5%.
Sustainable Finance Volumes Up 29% compared to the same period last year, reflecting commitment to supporting clients in sustainability transitions.
Net Profit EUR 6 billion over the past 4 quarters, contributing an additional 2 percentage points to the CET1 ratio.
Shareholder Distributions EUR 4.5 billion over the last 12 months and EUR 12.5 billion over the last 3 years, including a EUR 2 billion share buyback program concluded earlier this week and an additional EUR 1.6 billion distribution announced.
CET1 Ratio Updated target of around 13%, with a buffer of about 180 basis points above the MDA threshold.
Commercial Net Interest Income (NII) Expected to come in between EUR 15.2 billion and EUR 15.3 billion for full year 2025, driven by strong performance in Wholesale Banking Lending and Retail Banking Germany.
Expenses Excluding regulatory costs and incidental items, rose less than 3% year-on-year, reflecting wage inflation and ongoing investment in business growth and scalability.
Risk Costs EUR 326 million this quarter, equivalent to 19 basis points of average customer lending, below the through-the-cycle average.
You have reached the limit. Sign up to access full content
Get started
Operating Highlights
Mobile primary customers: Added nearly 200,000 mobile primary customers during the quarter, bringing growth in the last 12 months to over 1.1 million.
Loan book expansion: Retail saw EUR 8.6 billion in net core lending growth, mainly driven by residential mortgages. Wholesale Banking also delivered strong growth supported by trade finance services and lending.
Sustainable finance: Sustainable finance volumes increased by 29% compared to the same period last year.
Customer balances: Grew at an annualized rate of 7% in the first 9 months of 2025, on track to achieve a 4% annual growth target.
Fee income: Year-to-date fees grew by 12%, with a full-year growth outlook raised to more than 10%.
Capital generation: Delivered EUR 6 billion of net profit over the past 4 quarters, contributing an additional 2 percentage points to the CET1 ratio.
Operational efficiencies: Investing in digitization and generative AI capabilities, including a GenAI chatbot live in 6 markets and AI-assisted loan processing.
Cost management: Proactive measures to operate efficiently, guiding total costs towards the lower end of the EUR 12.5 billion to EUR 12.7 billion range.
Shareholder returns: Announced an additional EUR 1.6 billion distribution, including a EUR 1.1 billion share buyback and EUR 500 million cash dividend.
CET1 ratio target: Revised CET1 ratio target to around 13%, with excess capital above this threshold to be returned to shareholders.
You have reached the limit. Sign up to access full content
Get started
Risk or Challenges
Macroeconomic and geopolitical uncertainty: The company acknowledges the prevalence of macroeconomic and geopolitical uncertainty, which could impact its operations and financial performance.
Core deposits decline: Core deposits declined slightly due to promotional campaigns and seasonal spending patterns, which could affect liquidity and financial stability.
Regulatory changes: The CET1 MDA target has risen due to regulatory changes, requiring adjustments in capital targets and planning.
Incidental expenses: Additional incidental expenses, including restructuring provisions, could impact cost management and financial performance.
Risk costs: Total risk costs were EUR 326 million this quarter, with net additions to Stage 3 provisions due to collective provisioning in Retail Banking and newly defaulted files in Wholesale Banking.
Loan book quality: The company faces risks related to the quality of its loan book, as evidenced by the need for collective provisioning and newly defaulted files.
Operational risk-weighted assets: Operational risk-weighted assets remained flat, but any future increases could pose challenges to capital adequacy.
Market risk-weighted assets: Market risk-weighted assets decreased, but fluctuations in these assets could impact financial stability.
You have reached the limit. Sign up to access full content
Get started
Guidance & Outlook
Fee Growth: The company has raised its expectation for fee growth, now anticipating fees to come in more than 10% higher than last year.
Total Income: The company has increased its outlook for total income, expecting it to reach around EUR 22.8 billion in 2025.
Cost Management: The company continues to guide total costs towards the lower end of the EUR 12.5 billion to EUR 12.7 billion range, despite additional incidental expenses this quarter.
CET1 Ratio Target: The CET1 target has been updated to around 13%, providing a buffer of about 180 basis points above the MDA threshold.
Return on Equity (ROE): The company has raised its ROE expectation for 2025 to more than 12.5%.
Mobile Primary Customers: The company remains on track to achieve its annual growth target of 1 million mobile primary customers in 2025, having added nearly 700,000 so far this year.
Commercial NII: The company expects commercial NII to come in between EUR 15.2 billion and EUR 15.3 billion for the full year 2025.
Shareholder Returns: The company announced an additional EUR 1.6 billion distribution, including a EUR 1.1 billion share buyback and a EUR 500 million cash dividend to be paid in January 2026.
You have reached the limit. Sign up to access full content
Get started
Shareholder Return Plan
Ordinary Cash Dividend Yield: Nearly 6% in the last 12 months.
Cash Dividend Payment: EUR 500 million to be paid in January 2026.
Share Buyback Program: EUR 2 billion program started in May 2025 and concluded earlier this week.
Additional Share Buyback: EUR 1.1 billion announced as part of a new distribution.
You have reached the limit. Sign up to access full content
Get started
Key Q&A
Q:Do you think we are entering a phase of stabilization for CET1 requirements, or could there be more pressure?
A:Currently, there is no additional pressure on capital. Discussions with supervisors are ongoing to avoid duplication or gold plating between different markets. The mortgage floor, which could come in 2032, is also being discussed for potential removal.
Q:What are the trends in NII and deposits for Q4?
A:Retail deposits saw an outflow of EUR 7 billion, while Wholesale deposits had an inflow of EUR 7 billion, resulting in flat deposits overall. The outflows were due to a marketing campaign in Germany and seasonal effects. Annualized deposit growth for the first 9 months is 6%, and no similar seasonal patterns are expected in Q4.
Q:How do you expect lending margins to grow from 125 bps to 125-130 bps by 2026-2027?
A:The normalization of mortgage financing and the subsiding of funding profile costs are expected to reduce margin compression. Growth in Wholesale Banking loans, which have higher margins, will also contribute to the increase.
Q:Why is the AI initiative not being rolled out in other countries?
A:The AI initiative is being rolled out globally, with the GenAI chatbot already implemented in six countries. The announcement about job impacts in the Netherlands was specific to that country due to regulatory requirements.
Q:Have you invested in AI for KYC and client onboarding functions?
A:Yes, investments have been made in digitalizing KYC and supporting it with AI and GenAI. This is expected to impact processes and staff operations positively.
Q:What is your approach to capital redeployment and M&A in the current rate environment?
A:The focus remains on making more impact in existing markets by exploring market segments like business banking, consumer lending, private banking, and wealth management. Any M&A activity must make sense from an ROE perspective.
Q:What is the guidance for NII for the year?
A:The guidance for NII is EUR 15.2 billion to EUR 15.3 billion. Q3 saw a catch-up in Wholesale Banking NII growth due to previously robust pipelines converting into loans and transactions.
Q:Are the recent incidentals on the cost line expected to be recurring?
A:The approach is to take provisions for clear business cases that can be achieved over 12-18 months. Continued efficiency programs and additional restructuring provisions are expected in Q4.
Q:What is your view on the outcome of the Dutch elections?
A:A stable government that can take long-term decisions is seen as beneficial for society and the economy. Pro-Europe parties are expected to foster international ties and support policies like the sales and investment union.
Q:Is there more confidence in the 14% ROE target for 2027?
A:There is more confidence in the 2025 ROE target due to better-than-expected volumes and fee growth. Further updates will be provided in February.
Q:Are efficiency gains and digitalization embedded in the 3%-4% OpEx CAGR target?
A:Yes, the efficiency gains and digitalization plans are in line with the Capital Markets Day guidance.
Q:What is the outlook for NII in Q4 and beyond?
A:The outlook for NII includes tailwinds from ECB rates and a positive yield curve. The guidance remains EUR 15.2 billion to EUR 15.3 billion for the year, with expected positive impacts in 2026 and beyond.
Q:What is driving growth in Wholesale Banking?
A:Growth is driven by larger underwritings, syndicated loans, and increased economic activity in trade financial services. This has led to EUR 5.5 billion growth in Wholesale Banking.
Q:Are there any trends in newly defaulted files in Wholesale Banking?
A:No specific sector-wide patterns were observed. Defaults are more due to idiosyncratic events rather than systemic issues.
Q:What is the impact of the increased CET1 target on businesses?
A:The divisional ROE is now based on 13% of risk-weighted assets, aligning with many Wholesale Banking peers. No material competitive disadvantage is expected.
Q:What are the retention rates for deposit campaigns in Germany and Belgium?
A:Retention rates are around 2/3 for both campaigns, consistent with historical performance. Both campaigns are expected to deliver strong returns on investment.
Q:What is the expected evolution of full-time employees (FTEs)?
A:Total internal and external FTEs have been around flat this year, with more internalized FTEs. Investments are focused on scalable growth with positive jaws.
Q:Why is NII not significantly higher despite a more beneficial rate curve?
A:Deposit beta has risen significantly, impacting NII. Further updates on the outlook will be provided with Q4 results.
Q:Review of Unclear Management Responses
A:Management avoided providing a direct answer on whether lending margins would decline in Q4, citing dependencies on Wholesale Banking and Retail Banking activity. Additionally, they deferred providing a detailed outlook on NII growth relative to the CMD expectations, promising updates in early 2026.
You have reached the limit. Sign up to access full content
Get started
Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
AI
Bank Beijing
Banking Lending
Banking inflow
Core Tier
EUR distribution
Executive Banking
Income
MDA
NII Wholesale
ROE
Slide development
Wholesale Banking
allocation
amount EUR
application
approach
buffer
capital CET
capital generation
cash dividend
distribution EUR
dividend share
equity
fee outlook
finance
income EUR
income trend
inflow quarter
market cash
measure
month EUR
outlook income
payment cash
ratio line
saving campaign
shareholder return
stake Bank
track
ING Transcript
ING Groep N.V. (ING) Q1 2026 Earnings Call Transcript
Positive4-30
The earnings call reflects strong financial performance with increased net core lending and core deposits. Fee income growth is notable, especially in investment products. Expenses are well-managed, and the CET1 ratio is stable despite a share buyback. The Q&A reveals a positive outlook on liability margins, insurance strategy, and mortgage demand, although some uncertainties remain in wholesale banking. Overall, the company's strategic plans and financial health indicate a positive sentiment, likely leading to a stock price increase of 2% to 8%.
ING Groep N.V. (ING) Presents at European Financials Conference 2026 Transcript
Neutral3-18
ING Groep N.V. (ING) Q4 2025 Earnings Call Transcript
Positive1-30
The earnings call highlights strong financial performance with increased fee income, a significant lending book, and growth in deposits. The company shows robust product development and market strategy, notably in digital and sustainable initiatives. While risk costs and competition are concerns, the positive guidance and shareholder returns, including a share buyback and dividend, suggest a favorable outlook. The Q&A session indicates management's proactive approach to emerging risks and opportunities, further supporting a positive sentiment.
Calix, Inc. (CALX) Q4 2025 Earnings Call Transcript
Positive1-29
The earnings call summary and Q&A session indicate positive sentiment. The company has raised fee growth and total income expectations, maintained cost management, and announced substantial shareholder returns. Despite not including international expansion in 2026 numbers, confidence in growth and AI capabilities is high. Strong appliance margins and expected software margin improvements further support positive sentiment. The lack of specific guidance on certain revenue contributions is a minor concern but doesn't overshadow the overall optimistic outlook.
ING Report
Frequently Asked Questions
Where does this earnings call transcript come from?
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
How soon is the transcript available after the earnings call ends?
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
Is the transcript edited or altered in any way?
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
Why do some answers appear as “Unclear” or “Inaudible”?
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
Who creates the AI Summary and Key Q&A highlights shown above the transcript?
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
