Obligation ING Groep 0% ( XS1505551678 ) en USD

ING Groep

100 % ▲

Pays-Bas

XS1505551678 ( en USD )

20/10/2046 - Obligation échue

Prospectus brochure de l'obligation ING Bank XS1505551678 en USD 0%, échue

1 000 000 USD

50 000 000 USD

ING est une banque internationale offrant une large gamme de services financiers, notamment des services de banque de détail, de banque privée et de gestion d'actifs, opérant dans plusieurs pays à travers le monde.

L'Obligation émise par ING Groep ( Pays-Bas ) , en USD, avec le code ISIN XS1505551678, paye un coupon de 0% par an.
Le paiement des coupons est semestriel et la maturité de l'Obligation est le 20/10/2046

Dated 24 March 2023

ING BANK N.V.
(A limited liability company (naamloze vennootschap) incorporated in The Netherlands with its statutory seat in
Amsterdam)

REGISTRATION DOCUMENT
This document constitutes a registration document, as supplemented from time to time (the "Registration
Document") for the purpose of Regulation (EU) 2017/1129, as amended (the "Prospectus Regulation") in relation
to ING Bank N.V. (the "Issuer" or "ING Bank") and has been drawn up in accordance with Annex 6 of the
Commission Delegated Regulation (EU) 2019/980, as amended.
This Registration Document has been approved by the Netherlands Authority for the Financial Markets (the "AFM")
on 24 March 2023 in its capacity as competent authority pursuant to Article 20 of the Prospectus Regulation. Together
with any securities note for non-equity securities, as supplemented or replaced from time to time (each a "Securities
Note") of the Issuer, in each case, this Registration Document forms part of any prospectus of the Issuer consisting
of separate documents within the meaning of the Prospectus Regulation in respect of the relevant securities (this
Registration Document together with the respective Securities Note, in each case the "Prospectus"). The AFM only
approves this Registration Document as meeting the standards of completeness, comprehensibility and
consistency imposed by the Prospectus Regulation. Such approval should not be considered as an endorsement
of the Issuer that is the subject of this Registration Document.
Investors should have regard to the risk factors described under the section headed "Risk Factors" in this Registration
Document. This Registration Document does not describe all of the risks regarding the Issuer, but the Issuer believes
that all material and specific risks relating to it have been described.

TABLE OF CONTENTS
Page
TABLE OF CONTENTS ................................................................................................................................... 2
RISK FACTORS ................................................................................................................................................ 3
IMPORTANT NOTICES ..................................................................................................................................27
DOCUMENTS INCORPORATED BY REFERENCE .....................................................................................29
DESCRIPTION OF ING BANK N.V. ..............................................................................................................32
SELECTED FINANCIAL INFORMATION ....................................................................................................56
OPERATING AND FINANCIAL REVIEW AND PROSPECTS ....................................................................59
SELECTED STATISTICAL INFORMATION .................................................................................................79
GENERAL INFORMATION ............................................................................................................................89

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RISK FACTORS
Any of the risks described below could have a material adverse effect on the business activities, financial
condition, results and prospects of ING as well as ING's reputation. The Issuer may face a number of the risks
described below simultaneously and, where a cross-reference to another risk is included, the risks described
below may be interdependent. While the risk factors below have been divided into categories, some risk factors
could belong in more than one category and investors should carefully consider all of the risk factors set out in
this section. Where a risk factor could belong in more than one category, such risk factor is included in the
category that is most appropriate for it. Additional risks of which the Issuer is not presently aware, or that are,
as at the date of this Registration Document, viewed as immaterial, could also affect the business operations of
ING and have a material adverse effect on ING's business activities, financial condition, results and prospects.
The market price of ING shares or other securities could decline due to any of those risks including the risks
described below, and investors could lose all or part of their investments.
Although the most material risk factors have been presented first within each category, the order in which the
remaining risk factors are presented is not necessarily an indication of the likelihood of the risks actually
materialising, of the potential significance of the risks or of the scope of any potential negative impact to the
Issuer's business, results, financial condition and prospects.
ING Group is a holding company whose principal asset is its investments in the capital stock of ING Bank, its
primary banking subsidiary. As a result, the risks applicable to ING Bank are substantially similar to those
impacting ING Group.
1
Risks related to financial conditions, market environment and general economic trends
ING's revenues and earnings are affected by the volatility and strength of the economic, business, liquidity,
funding and capital markets environments of the various geographic regions in which it conducts business,
as well as by changes in customer behaviour in these regions, and an adverse change in any one region
could have an impact on its business, results and financial condition.
Because ING is a multinational banking and financial services corporation, with a global presence and serving
around 37 million customers, corporate clients and financial institutions in over 40 countries, ING's business,
results and financial condition may be significantly impacted by turmoil and volatility in the worldwide
financial markets or in the particular geographic areas in which the Issuer operates. In Retail Banking, ING's
products include savings, payments, investments, loans and mortgages in most of the Issuer's Retail Banking
markets. In Wholesale Banking, the Issuer provides specialised lending, tailored corporate finance, debt and
equity market solutions, payments & cash management, trade and treasury services. As a result, negative
developments in financial markets and/or countries or regions in which the Issuer operates have in the past had
and may in the future have a material adverse impact on its business, results and financial condition, including
as a result of the potential consequences listed below.
Factors such as inflation or deflation, interest rates, securities prices, credit spreads, liquidity spreads, exchange
rates, consumer spending, changes in customer behaviour, climate change, business investment, real estate
values and private equity valuations, government spending, the volatility and strength of the capital markets,
political events and trends, supply chain disruptions, shortages, terrorism, pandemics and epidemics (such as
the recent Covid-19 pandemic) or other widespread health emergencies all impact the business and economic
environment and, ultimately, the Issuer's solvency, liquidity and the amount and profitability of business the
Issuer conducts in a specific geographic region. Certain of these risks are often experienced globally as well as
in specific geographic regions. Please see the interdependent risk factors `Interest rate volatility and other
interest rate changes may adversely affect the Issuer's business, results and financial condition', `Inflation
and deflation may negatively affect the Issuer's business, results and financial condition', `Market conditions,
3

including those observed over the past few years, may increase the risk of loans being impaired and have a
negative effect on the Issuer's results and financial condition' and `Continued risk of political instability and
fiscal uncertainty in Europe and the United States, as well as ongoing volatility in the financial markets and
the economy generally have adversely affected, and may continue to adversely affect, the Issuer's business,
results and financial condition' for a further description of how ING's business, results and financial condition
may be materially impacted by these risks. All of these are factors in local and regional economies as well as in
the global economy, and the Issuer may be affected by changes in any one of these factors in any one country
or region, and more if more of these factors occur simultaneously and/or in multiple countries or regions or on
a global scale.
In case one or more of the factors mentioned above adversely affects the profitability of the Issuer's business,
this might also result, among other things, in the following:
·
inadequate reserves or provisions, in relation to which losses could ultimately be realised through profit
and loss and shareholders' equity;
·
the write-down of tax assets impacting net results and/or equity;
·
impairment expenses related to goodwill and other intangible assets, impacting net result and equity;
and/or
·
movements in risk weighted assets for the determination of required capital.
In particular, the Issuer is exposed to financial, economic, market and political conditions in the Benelux
countries and Germany, from which it derives a significant portion of its revenues in both Retail Banking and
Wholesale Banking, and which could present risks of economic downturn. Though less material, the Issuer also
derives substantial revenues in the following geographic regions: United States, Turkey, Poland and the
remainder of Eastern Europe, Southern Europe, East Asia (primarily Singapore among others) and Australia. In
an economic downturn affecting some or all of these jurisdictions, the Issuer expects that higher unemployment,
lower family income, lower corporate earnings, higher corporate and private debt defaults, lower business
investments and lower consumer spending would adversely affect the demand for banking products, and that
ING may need to increase its reserves and provisions, each of which may result in overall lower earnings.
Securities prices, real estate values and private equity valuations may also be adversely impacted, and any such
losses would be realised through profit and loss and shareholders' equity. The Issuer also offers a number of
financial products that expose it to risks associated with fluctuations in interest rates, securities prices, corporate
and private default rates, the value of real estate assets, exchange rates and credit spreads. Further, while the
Covid-19 pandemic and related response measures have eased, the effects of these measures are still being felt
in the financial performance and stability of certain of ING's business customers. As a result, their impact may
continue to affect ING's business. ING also has wholesale banking activities in both Russia and Ukraine, as
well as investments in Russia, some of which are denominated in local currency. In response to Russia's
invasion of Ukraine, the international community imposed various punitive measures, including sanctions,
capital controls, restrictions on SWIFT access and restrictions on central bank activity. These measures have
significantly impacted, and may continue to significantly impact, Russia's economy and have contributed to
heightened instability in global markets and increased inflation due in part to supply chain constraints, as well
as higher energy and commodity prices. Should prices remain elevated for an extended period, most businesses
and households would be negatively impacted, and ING's business in Russia and Ukraine, as well as its broader
business, may be adversely affected, including through spill-over risk to the entire wholesale banking portfolio
(e.g. commodities financing, energy and utilities and energy-consuming clients).
Environmental and/or climate risks may also directly and indirectly impact ING, for example through (among
other things) losses suffered as a result of extreme weather events, the impact of climate related transition risk
4

on the risk and return profile or value of security or operations of certain categories of customer to which ING
has exposure. In addition, these risks may also increase ING's reputational and litigation risk if the economic
activity that ING supports is not in line with community expectations or ING's external commitments (this
includes, but is not limited to, greenwashing risk). Please see the risk factor "Risks related to the Group's
business and operations The Issuer may be unable to meet internal or external aims or expectations with
respect to ESG-related matters" for further information on how these risks may adversely impact ING's
business, financial condition and operating results.
For further information on ING's exposure to particular geographic areas, see Note 32 `Information on
geographical areas' in the 2022 Annual Report, which is incorporated by reference into this Registration
Document.
ING's business, results and financial condition have been, and may continue to be, adversely affected by the
Covid-19 pandemic.
The Covid-19 pandemic and the related response measures introduced by various national and local
governmental authorities (such as restrictions on social activity, travel, movement and certain economic
activity) have had, and are expected to continue to have, adverse effects on global economic conditions,
including inflation, depressed global economic growth, disrupted supply chains, manufacturing, tourism,
reduced consumer spending, lower asset prices and higher unemployment levels, as well as increased volatility
and uncertainty across the global economy and financial markets. Please also refer to the interdependent risk
factor `ING's revenues and earnings are affected by the volatility and strength of the economic, business,
liquidity, funding and capital markets environments of the various geographic regions in which it conducts
business, as well as by changes in customer behaviour in these regions, and an adverse change in any one
region could have an impact on its business, results and financial condition' for a further description of how
ING's business, results and financial condition may be materially adversely impacted by developments in
regional or global economic conditions.
If these effects are prolonged, or if new Covid-19 variants emerge which require reimplementation of the
response measures outlined above, the economies in which ING and its customers and counterparties operate
may experience heightened stress and an increased risk of recession, which may increase the risk of customer
defaults and materially adversely affect ING's business, results, financial condition and prospects.
Additionally, as of 31 December 2022, a significant portion of ING's staff continue to work from home, on a
full- or part-time basis. If due to illness, technical limitations or other restrictions, employees are unable to work
or are not able to operate as effectively and efficiently remotely as they did in the office, this may adversely
affect ING's business, results and financial condition.
In addition, a situation in which most or some of ING's employees continue working from home may raise
operational risks, including with respect to information security, data protection, availability of key systems and
infrastructure integrity. There is also a risk that ING will not be effective in implementing regulatory or strategic
change programmes in the current environment. The Covid-19 pandemic has led to new banking behaviour
from customers. There has been an increase in the digital behaviour of ING's customers leading to reduced
traffic in branches. Over 95% of its customers now interact with ING via digital channels only. This increased
reliance on digital banking and remote working may increase the risk of cybersecurity breaches, loss of personal
data and related reputational risk. If any of these risks were to materialise that may adversely affect ING's
business, results and financial condition.
Interest rate volatility and other interest rate changes may adversely affect the Issuer's business, results and
financial condition.
5

Changes in prevailing interest rates may negatively affect the Issuer's business, including the level of net interest
revenue the Issuer earns, and the levels of deposits and the demand for loans. In response to rising inflation
globally, central banks (including the ECB, the US Federal Reserve and the RBA and RBNZ) have begun to
rapidly increase policy rates. This cycle is expected to continue throughout FY2023. This rapid rise in policy
rates may result in:
·
a decrease in the demand for loans;
·
higher interest rates to be paid on customer deposits and on debt securities that the Issuer has issued or
may issue on the financial markets from time to time to finance its operations, which would increase its
interest expenses and reduce its results;
·
changes to customer demand, particularly an increase in the attractiveness of certain products, such as
fixed term deposits, which may lead to ING being required to pay higher rates on its liabilities;
·
higher interest rates which can lead to lower investment prices and reduce the revaluation reserves,
thereby lowering IFRS equity and the capital ratios. Also the lower securities value leads to a loss of
liquidity generating capacity which needs to be compensated by attracting new liquidity generating
capacity which reduces the Issuer's results;
·
prepayment losses if prepayment rates are lower than expected or if interest rates increase too rapidly to
adjust the accompanying hedges; and/or
·
(depending on the position) a significant collateral posting requirement associated with the Issuer's
interest rate hedge programme.
Further, a sustained increase in the inflation rate in the Issuer's principal markets and related interest rate
volatility may also reduce disposable income for households and may increase household and business financial
stress, and therefore negatively affect its business, results and financial condition. A failure to accurately
anticipate inflation on an ongoing basis and factor it into the Issuer's product pricing assumptions may result in
mispricing of its products, which could materially and adversely impact its results.
Despite the recent rise in policy rates, in which policy rates in various jurisdictions in which the Issuer operates
have risen at a rapid pace as set out above, interest rates are still relatively low by historical standards and have
been low for a prolonged period, which has resulted in, and may (if the expected rate rises do not materialise)
continue to result in:
·
lower earnings over time on investments, as reinvestments will earn lower rates;
·
increased prepayment or redemption of mortgages and fixed maturity securities in the Issuer investment
portfolios, as well as increased prepayments of corporate loans. This as borrowers seek to borrow at
lower interest rates potentially combined with lower credit spreads. Consequently, the Issuer may be
required to reinvest the proceeds into assets at lower interest rates;
·
lower profitability as the result of a decrease in the spread between client rates earned on assets and
client rates paid on savings, current account and other liabilities;
·
higher costs for certain derivative instruments that may be used to hedge certain of the Issuer's product
risks;
·
lower profitability since the Issuer may not be able to fully track the decline in interest rates in its savings
rates;
6

·
lower profitability since the Issuer may not always be entitled to impose surcharges to customers to
compensate for the decline in interest rates;
·
lower profitability since the Issuer may have to pay a higher premium for the defined contribution
scheme in the Netherlands for which the premium paid is dependent on interest rate developments and
the Dutch Central Bank's ("DNB's") methodology for determining the ultimate forward rate;
·
lower interest rates may cause asset margins to decrease thereby lowering the Issuer's results. This may
for example be the consequence of increased competition for investments as result of the low rates,
thereby driving margins down; and/or
·
(depending on the position) a significant collateral posting requirement associated with the Issuer's
interest rate hedge programmes, which could materially and adversely affect liquidity and its
profitability.
Each of the preceding risks, should they materialise, may adversely affect the Issuer's business, results and
financial condition.
The default of a major market participant could disrupt the markets and may have an adverse effect on the
Issuer's business, results and financial condition.
Within the financial services industry, the severe distress or default of any one institution (including sovereigns
and central counterparties (CCPs)) could lead to defaults by, or the severe distress of, other market participants.
While prudential regulation may reduce the probability of a default by a major financial institution, the actual
occurrence of such a default could have a material adverse impact on ING. Such distress of, or default by, a
major financial institution could disrupt markets or clearance and settlement systems and lead to a chain of
defaults by other financial institutions, since the commercial and financial soundness of many financial
institutions may be closely related as a result of credit, trading, clearing or other relationships. Also, the
perceived lack of creditworthiness of a sovereign or a major financial institution (or a default by any such entity)
may lead to market-wide liquidity problems and losses or defaults by the Issuer or by other institutions. This
risk is sometimes referred to as `systemic risk' and may adversely affect financial intermediaries, such as
clearing agencies, clearing houses, banks, securities firms and exchanges with whom the Issuer interacts on a
daily basis and financial instruments of sovereigns in which it invests. Systemic risk could impact ING directly,
by exposing it to material credit losses on transactions with defaulting counterparties or indirectly by
significantly reducing the available market liquidity on which ING and its lending customers depend to fund
their operations and/or leading to a write down of loans or securities held by ING. In addition, ING may also
be faced with additional open market risk for which hedging or mitigation strategies may not be available or
effective (either by hedges eliminated by defaulting counterparties, or reduced market liquidity). Systemic risk
could have a material adverse effect on ING's ability to raise new funding and on ING's business, results and
financial condition. In addition, such distress or failure could impact future product sales as a potential result
of reduced confidence in the financial services industry.
Continued risk of political instability and fiscal uncertainty in Europe and the United States, as well as
ongoing volatility in the financial markets and the economy generally have adversely affected, and may
continue to adversely affect, the Issuer's business, results and financial condition.
The Issuer's global business and results are materially affected by conditions in the global capital markets and
the economy generally. In Europe, there are continuing concerns over weaker economic conditions, levels of
unemployment in certain countries, the availability and cost of credit, as well as credit spreads. In addition,
geopolitical issues, including trade tensions between the US and China, increasing protectionism between key
countries, and issues with respect to the Middle East and North Korea may all contribute to adverse
developments in the global capital markets and the economy generally. In addition, Russia's invasion of Ukraine
7

and related international response measures have had, and are expected to continue to have, a negative impact
on regional and global economic conditions, including heightened instability in global markets and increased
inflation due in part to supply chain constraints, as well as higher energy and commodity prices.. Should prices
remain elevated for an extended period, most businesses and households would be negatively impacted, and the
Issuer's business in Russia and Ukraine, as well as its broader business, may be adversely affected, including
through spill-over risk to ING's entire wholesale banking portfolio, in areas such as commodities financing,
energy and utilities and energy-consuming clients.
Moreover, there is a risk that an adverse credit event at one or more European sovereign debtors (including a
credit rating downgrade or a default) could trigger a broader economic downturn in Europe and elsewhere. In
addition, the confluence of these and other factors has resulted in volatile foreign exchange markets.
International equity markets have also continued to experience heightened volatility and turmoil, with issuers,
including the Issuer, that have exposure to the real estate, mortgage, private equity and credit markets
particularly affected. These events, market upheavals and continuing risks, including high levels of volatility,
have had and may continue to have an adverse effect on the Issuer's results, in part because it has a large
investment portfolio.
There is also continued uncertainty over the long-term outlook for the tax, spending and borrowing policies of
the US, the future economic performance of the US within the global economy and any potential future
budgetary restrictions in the US, with a potential impact on a future sovereign credit ratings downgrade of the
US government, including the rating of US Treasury securities. A downgrade of US Treasury securities could
also impact the ratings and perceived creditworthiness of instruments issued, insured or guaranteed by
institutions, agencies or instrumentalities directly linked to the US government. US Treasury securities and
other US government-linked securities are key assets on the balance sheets of many financial institutions and
are widely used as collateral by financial institutions to meet their day-to-day cash flows in the short-term debt
market. The impact of any further downgrades to the sovereign credit rating of the US government or a default
by the US government on its debt obligations would create broader financial turmoil and uncertainty, which
would weigh heavily on the global financial system and could consequently result in a significant adverse
impact to the Issuer's business and operations.
In many cases, the markets for investments and instruments have been and remain illiquid, and issues relating
to counterparty credit ratings and other factors have exacerbated pricing and valuation uncertainties. Valuation
of such investments and instruments is a complex process involving the consideration of market transactions,
pricing models, management judgement and other factors, and is also impacted by external factors, such as
underlying mortgage default rates, interest rates, rating agency actions and property valuations. Historically
these factors have resulted in, among other things, valuation and impairment issues in connection with the
Issuer's exposures to European sovereign debt and other investments.
Any of these general developments in global financial and political conditions could negatively impact to the
Group's business, results and financial condition in future periods.
Discontinuation of interest rate benchmarks may negatively affect the Issuer's business, results and financial
condition.
Changes to major interest rates benchmarks may negatively affect the Issuer's business, including the level of
net interest revenue. Financial markets have historically relied on Interbank Offered Rates ("IBORs")
benchmarks, such as the London Interbank Offered Rate ("LIBOR"), the Euro Over Night Index Average
("EONIA") and the Euro Interbank Offered Rate ("EURIBOR"). While some interest benchmarks have been
reformed and will continue to exist, such as EURIBOR, others such as EONIA, LIBOR and the Warsaw
Interbank Offered Rate ("WIBOR") have been or will be replaced by recommended alternative rates.
8

EONIA ceased to be published on 3 January 2022, and is succeeded by STR. All GBP, JPY, CHF and EUR
LIBOR settings ceased on 31 December 2021.
The most used USD LIBOR tenors will continue to be published until 30 June 2023 to support existing
contracts, with the use of USD LIBOR for new contracts only allowed in limited circumstances.
Public authorities have recognised that many contracts do not contain reference to alternative rates, or reference
inappropriate alternatives, or cannot be renegotiated or amended prior to the cessation of the relevant
benchmark. In response the UK government has granted additional powers to the Financial Conduct Authority
(FCA) to enable the temporary publication of a `synthetic' LIBOR using a different methodology and inputs.
The FCA used these powers to ensure GBP and JPY LIBOR continued to be available using this "synthetic"
methodology for a limited time to assist in transition. The FCA has proposed a requirement for the LIBOR
benchmark administrator to publish synthetic 1-, 3- and 6-month USD LIBOR until 30 September 2024 to
support those contracts not transitioned by 30 June 2023. This proposal is currently in consultation. The U.S
has also passed legislation to assist in benchmark transition covering most contracts governed by U.S law that
involve USD LIBOR. The legislation has the effect, for those contracts that do not include suitable "fallback"
rate provisions, of amending the contractual terms to switch to the recommended fallback rate for USD LIBOR
(being the Secured Overnight Financing Rate), which is economically similar to synthetic LIBOR.
Additionally, in 2022 the Polish National Working Group published a roadmap indicating that the market should
be prepared for a cessation of, among others, the WIBOR reference rate in 2025. It is expected that the reform
will be completed by the end of 2024, with the offering of financial products using the new benchmark
(WIRON) to progress gradually in 2023 and 2024.
The discontinuation of USD LIBOR, WIBOR and related interest rate benchmarks could result in a number of
risks for the Group, its customers, and the financial services industry more widely. These risks include legal
risks and costs in relation to changes required to documentation for existing transactions. In addition to the
heightened conduct and operational risks, the process of adopting new reference rates may expose the Group to
an increased level of financial risk, such as potential earnings volatility resulting from contract modifications
and changes in hedge accounting relationships.
As at the date of this Registration Document, it is not possible to determine the full impact of each of the USD
LIBOR and WIBOR transitions on the Group and any such impact could have a material adverse effect on the
Issuer's business, results and financial condition.
ING continues to monitor market developments and reform plans for other rates to anticipate the impact on its
customers and any related risks.
Inflation and deflation may negatively affect the Issuer's business, results and financial condition.
Globally, inflation increased significantly during FY2022. If the increased in inflation are prolonged in the
Issuer's principal markets, this could have multiple impacts on the Issuer and may negatively affect the Issuer's
business, results and financial condition. For example, a sustained increase in the inflation rate may result in an
increase in market interest rates, which may:
·
decrease the estimated fair value of certain fixed income securities that ING holds in its investment
portfolios, resulting in:
·
reduced levels of unrealised capital gains available to the Issuer, which could negatively impact ING's
solvency position and net income, and/or
·
a decrease in collateral values,
9

·
result in increased withdrawal of certain savings products, particularly those with fixed rates below
market rates,
·
require the Issuer, as an issuer of securities, to pay higher interest rates on debt securities that the Issuer
issues in the financial markets from time to time to finance its operations, which would increase its
interest expenses and reduce its results, and
·
result in further customer defaults as interest rate rises flow through into payment stress for lower credit
quality customers.
A significant and sustained increase in inflation has historically also been associated with decreased prices for
equity securities and sluggish performance of equity markets generally. A sustained decline in equity markets
may:
·
result in impairment charges to equity securities that the Issuer holds in its investment portfolios and
reduced levels of unrealised capital gains available to the Issuer which would reduce its net income, and
·
lower the value of the Issuer's equity investments impacting its capital position.
In addition, a failure to accurately anticipate higher inflation and factor it into the Issuer's product pricing may
result in a systemic mispricing of its products, which would negatively impact its results.
On the other hand, deflation could be experienced in the Issuer's principal markets, adversely affecting its
financial performance. Deflation may erode collateral values and diminish the quality of loans and cause a
decrease in borrowing levels, which would negatively affect the Issuer's business and results.
Market conditions, including those observed over the past few years, may increase the risk of loans being
impaired and have a negative effect on the Issuer's results and financial condition.
The Issuer is exposed to the risk that its borrowers (including sovereigns) may not repay their loans according
to their contractual terms and that the collateral securing the payment of these loans may be insufficient. The
Issuer may see adverse changes in the credit quality of its borrowers and counterparties, for example, as a result
of their inability to refinance their indebtedness, with increasing delinquencies, defaults and insolvencies across
a range of sectors. This may lead to impairment charges on loans and other assets, higher costs and additions to
loan loss provisions. A significant increase in the size of the Issuer's provision for loan losses could have a
material adverse effect on its business, results and financial condition.
The Issuer may incur losses due to failures of banks falling under the scope of state compensation schemes.
While prudential regulation is intended to minimise the risk of bank failures, in the event such a failure occurs,
given the Issuer's size, the Issuer may incur significant compensation payments to be made under the Dutch
Deposit Guarantee Scheme (DGS), which it may be unable to recover from the bankrupt estate, and therefore
the consequences of any future failure of such a bank could be significant to ING. Such costs and the associated
costs to be borne by the Issuer may have a material adverse effect on its results and financial condition. On the
basis of the EU Directive on deposit guarantee schemes, ING pays quarterly risk-weighted contributions into a
DGS-fund. The DGS-fund is to grow to a target size of 0.8% of all deposits guaranteed under the DGS, which
is expected to be reached in July 2024. In case of failure of a Dutch bank, depositor compensation is paid from
the DGS-fund. If the available financial means of the fund are insufficient, Dutch banks, including ING, may
be required pay to extraordinary ex-post contributions not exceeding 0.5% of their covered deposits per calendar
year. In exceptional circumstances and with the consent of the competent authority, higher contributions may
be required. However, extraordinary ex-post contributions may be temporarily deferred if, and for so long as,
they would jeopardise the solvency or liquidity of a bank. Depending on the size of the failed bank, the available
10