ING Group Q2 Earnings Call Highlights

ING Group NYSE: ING reported second-quarter 2026 results marked by higher income, continued customer growth and an upgraded outlook for 2026 and 2027, as the Dutch bank said its “Growing the Difference” strategy was producing improved operating leverage and profitability.

Chief Executive Officer Steven van Rijswijk said ING added 377,000 mobile primary customers during the quarter, bringing growth over the past 12 months to more than 1 million customers. He said primary banking relationships support deeper engagement, cross-selling, higher balances and greater income per customer.

Loan growth exceeded an 8% annualized pace, while deposits grew at an annualized 8.5% rate. Fee income rose 14% from a year earlier, and sustainable volume mobilized increased 28% in the first half. Over the past 12 months, income increased by more than 5%, while headcount fell by more than 1% and costs increased by about 2%, resulting in operating jaws of more than 3 percentage points, according to the company.

ING’s return on tangible equity, or ROTE, reached 17% in the second quarter. Its four-quarter rolling ROTE improved by 1.5 percentage points year over year.

Income growth and balance-sheet expansion

Chief Financial Officer Ida Lerner said total income increased 8% sequentially and 10% year over year, supported by commercial net interest income, fee income and a recovery in other income following heightened market volatility in the previous quarter.

Commercial net interest income rose by €114 million from the first quarter and was 10.7% above the prior-year period. Lending net interest income increased €16 million sequentially, supported by 8% annualized lending-volume growth, though lending margins declined slightly as growth tilted toward lower-risk-density loans. Liability net interest income rose €97 million, aided by higher deposit volumes and a 3-basis-point improvement in liability margin.

Net core lending increased €15.2 billion during the quarter. Retail banking accounted for €12.1 billion of that growth, driven by mortgages in the Netherlands, Germany, Italy and Australia, as well as business and consumer lending. Wholesale banking added €3 billion in net core lending.

Net core deposits increased €15.9 billion, including €16.7 billion of growth in retail banking. Lerner said retail inflows were supported by deposit-gathering campaigns and seasonal holiday-allowance payments, particularly in Germany and the Netherlands. Wholesale deposits declined slightly as positive momentum in payments and cash-pooling mandates was offset by outflows in more volatile financial-markets balances.

Fee income rose €42 million from the prior quarter and 14% year over year. Retail banking fee income grew 16%, while wholesale banking fee income increased 11%. ING said the number of customers holding an investment account rose 8%, and customers generated €21 billion of net inflows into assets under management over the past 12 months.

Guidance raised for income, fees and profitability

ING raised its full-year commercial net interest income outlook to between €16.8 billion and €17 billion. The bank also expects its average 2026 liability margin to be in the upper middle of its 100-to-110-basis-point guidance range.

Van Rijswijk said ING now expects to reach €5 billion in fee income in 2026, one year earlier than initially planned. For 2027, the bank raised its fee-income outlook to a range of €5.3 billion to €5.5 billion.

• Total income is now expected to exceed €24.5 billion in 2026 and €26 billion in 2027.
• ROTE is expected to exceed 15% in 2026 and 16% in 2027, each up 1 percentage point from prior guidance.
• ING reiterated its full-year operating-expense outlook, saying costs were tracking in line with expectations despite stronger customer activity and volumes.

Lerner said expenses excluding regulatory costs and incidental items increased 4.2% year over year in the quarter, reflecting annual salary increases and higher marketing expenses. Year-to-date cost growth was 2.7%. ING recorded €41 million in second-quarter incidental items that it said should produce roughly €40 million in annualized savings once fully implemented.

Capital optimization and shareholder distributions

ING’s CET1 ratio improved to 13.1% after the bank generated 65 basis points of CET1 capital during the quarter. Risk-weighted assets declined €2.4 billion, as €1 billion of relief from a significant risk transfer transaction, model updates, a partial reduction in its TTB stake and lower market risk-weighted assets more than offset business-related growth and foreign-exchange effects.

Wholesale banking risk-weighted assets fell €5.3 billion during the quarter despite lending growth. Van Rijswijk said wholesale banking’s risk-weighted assets were €4.6 billion lower year over year, supported by secondary loan sales, insurance, client portfolio optimization and significant risk transfer transactions.

The company said it had already exceeded its 2027 target to allocate 55% of capital to retail banking, reaching a 56%-44% split between retail and wholesale banking roughly 18 months ahead of plan.

Over the past 12 months, ING generated €6.7 billion of net profit, equivalent to 2 percentage points of CET1 capital. The bank said it reserved 50% for regular dividends, used around 10% to fund profitable growth and allocated the remaining approximately 40% to additional distributions, selective acquisitions or reserves outside CET1 capital.

ING’s share repurchase program announced in April remains underway and is expected to be completed in October. The company said it would next assess potential additional capital distributions when it reports third-quarter results.

Technology, private banking and risk outlook

Management highlighted efforts to use artificial intelligence to improve service and scalability. Van Rijswijk said ING’s Agentic Mortgages capability, currently live in the Netherlands, reduced the approval time for more complex mortgage cases to five days from seven days while allowing the bank to process more applications without adding staff.

ING also discussed expanding private banking, including a new Italian offering and plans for Spain. The bank acquired an approximately 40% stake in Spanish wealth manager Singular Bank, which will continue operating independently. Van Rijswijk said the investment provides ING an opportunity to collaborate on customer opportunities and develop private-banking capabilities in Spain.

Second-quarter risk costs totaled €279 million, or 15 basis points of average customer lending, below ING’s through-the-cycle average of 20 basis points. Chief Risk Officer Andrea Cesaroni said the bank does not expect its increased use of significant risk transfer transactions to materially change its risk appetite, underwriting standards or through-the-cycle cost of risk.

About ING Group (NYSE:ING)

ING Group N.V. is a Dutch multinational financial services company headquartered in Amsterdam. Formed through the consolidation of Dutch financial businesses, ING operates as a banking and financial services group that serves retail, small and medium-sized enterprises, large corporates and institutional clients. The company is organized under a two-tier governance model common in the Netherlands, with an Executive Board responsible for day-to-day management and a Supervisory Board providing oversight.

ING's principal activities include retail and direct banking, commercial and wholesale banking, corporate lending, transaction services and cash management, and a range of investment and savings products.

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