ING Group (NYSE:ING) CEO Steven van Rijswijk said the bank’s improved profitability outlook is being supported by stronger revenue growth, operating scalability and capital discipline, while management remains focused on organic expansion and targeted bolt-on acquisitions.
Speaking at an investor event, van Rijswijk said ING has raised its 2027 return on tangible equity target to more than 16%, from the 14% target presented at its 2024 Capital Markets Day. The updated outlook includes revenue above €26 billion by 2027 and projected costs of about €13 billion, roughly €300 million below prior guidance.
Revenue Growth, Cost Scalability and Capital Management
Fee income has also developed faster than expected. ING had previously targeted approximately €5 billion of fees by 2027, but van Rijswijk said the bank has already reached that level this year. It now expects an additional €300 million to €500 million in fee growth by 2027.
Despite increased customer and business activity, ING expects to keep expenses under control through shared operational hubs and technology investments. Van Rijswijk cited centralized know-your-customer processes, contact centers, operational processing and the company’s cloud environment as tools that support scalability.
Capital management is the third major driver of the higher return outlook, according to the CEO. ING began using significant risk transfers last year after updating models to meet European Central Bank requirements. The bank completed about 12 basis points of risk transfers last year and expects 15 to 20 basis points this year, having completed 4 basis points year to date.
ING is also shifting its risk-weighted asset mix toward retail businesses. Van Rijswijk said retail represented 56% of the mix and wholesale banking 44%, exceeding the 55%-45% balance it had targeted for the end of 2027.
Mortgage Growth and Deposit Strategy
Mortgage lending has been a key contributor to retail growth. ING has about €380 billion in mortgages and is among Europe’s largest mortgage lenders, van Rijswijk said. He attributed growth both to housing shortages in several European countries and to ING’s digital mortgage capabilities.
In some markets, ING can process straightforward mortgage applications within 30 minutes, he said. In the Netherlands, the bank is using agentic artificial intelligence for more complex applications, reducing processing time from seven days to five days.
The bank is concentrating mortgage growth in markets where returns are attractive, including the Netherlands, Germany, Italy and Australia. In the Netherlands, ING’s overall mortgage-book market share is around 14%, while its production market share has run around 18% to 19% in recent quarters, van Rijswijk said.
He said ING does not manage the business based on net interest margin alone, noting that low-risk-weighted, collateralized lending may produce lower margins but still generate attractive returns on equity. ING’s lending margin moved from 126 basis points to 124 basis points, which van Rijswijk attributed more to changes in the lending-book mix than competitive pricing. He expects the margin to stabilize during the remainder of the year.
On funding, van Rijswijk said ING has more than €700 billion in deposits and maintains a loan-to-deposit ratio of about 100%, a level he described as comfortable. Approximately 95% of deposits receive the bank’s core rate, he said.
ING has increasingly used targeted “micro campaigns” rather than broad deposit promotions. A German micro campaign in the second quarter brought in an additional €8 billion, van Rijswijk said. The campaigns are designed not only to bring in deposits but also to convert customers into primary banking clients, who typically conduct three times more business with ING than non-primary customers.
Fees, Wholesale Banking and AI
Van Rijswijk said ING sees substantial room to expand investment, insurance, credit-card and packaged-banking offerings. The company’s assets under management have increased to €330 billion from less than €150 billion when he became CEO six years ago. ING now has 5.3 million investment customers out of 41 million total customers, he said.
The bank is consolidating nine investment platforms into one platform and selecting global asset-management partners to improve offerings across areas including private credit, private equity, exchange-traded funds and real estate.
While van Rijswijk said he believes in the universal-bank model, he acknowledged that wholesale banking’s returns need improvement. Wholesale banking is currently generating a return of about 11%, and ING aims to exit 2027 at 12%. However, he said that level “is still not enough” and that the bank will continue its “capital diet” for the division until returns are closer to its desired level.
Management plans to diversify wholesale banking beyond lending, particularly through financial markets and transaction services, while continuing to shift capital toward retail operations.
ING also plans to use artificial intelligence to improve both efficiency and customer experience. Van Rijswijk said the company has 600 employees working in AI, including about 300 in a hub in Türkiye. ING uses Google as its principal AI partner and has rolled out agentic AI mortgages in the Netherlands. It also expects AI to route 75% of chatbot traffic, compared with 45% several years ago.
Acquisition Approach Remains Selective
Van Rijswijk said organic growth remains ING’s primary strategic focus, citing growth of 5% to 10% in customer-related measures, 8% in balances and more than 10% in fees this year.
The bank is open to bolt-on deals that add skills or capabilities it lacks. He cited ING’s 40% stake in Spanish private bank Singular, where ING has an option to acquire the remaining shares, and an asset-management acquisition in Poland. Larger or more opportunistic transactions remain secondary to organic expansion, he said.
About ING Group (NYSE:ING)
ING Group N.V. is a Dutch international banking and financial services company headquartered in Amsterdam. Through its banking operations, ING provides retail and commercial banking services, including checking and savings accounts, consumer and business lending, mortgages, payments, investment products and digital banking solutions.
The company serves individual customers, small and medium-sized businesses, large corporations and institutional clients. Its retail banking activities are concentrated primarily in Europe, while its wholesale banking business supports clients in numerous countries with corporate lending, trade finance, financial markets, cash management and other banking services.
