ING Group NV Earnings - Q2 2025 Analysis & Highlights
ING Groep NV's Q2 2025 earnings call highlighted strong growth in mobile primary customers and loan book, diversified income streams with increased fee income, and an improved ROE outlook despite macroeconomic and geopolitical uncertainty.
Key Financial Results
The four quarter rolling average ROE was 12.7%.
The company improved its ROE outlook for the full year.
Fee income increased by 11% versus the first half of 2024 and now makes up almost 20% of total income.
Commercial NII is expected to be roughly stable in Q3, driven by the stronger euro, and increase thereafter, with the second half of 2025 higher than the first half due to continued volume growth and stable margins.
The company expects to be roughly stable in total income compared to 2024.
The company now expects a ROE of around 12.5% this year.
Total risk costs were €299 million this quarter, or 17 basis points of average customer lending.
Business Segment Results
Net core lending in Retail Banking grew by a record of €11.3 billion, mainly driven by mortgages.
In Wholesale Banking, net core lending growth was €4 billion.
Retail Banking benefited from the seasonality of holiday allowances.
Wholesale Banking continued attracting deposits in Payments & Cash Management and Money Markets.
Wholesale Banking fee came in at €360 million.
Growth in Retail Banking was fueled by a continued increase in mobile primary customers, which also resulted in higher daily banking fees.
Capital Allocation
The company has distributed close to €30 billion since 2021, including the announced interim dividend over the first half of 2025, which will be paid on August 11th.
The interim dividend over the first half of 2025 is €0.35 per share and will be paid on the 11th of August.
The company has been executing share buybacks for a number of years.
Industry Trends and Dynamics
Demand for long-term corporate loans has remained subdued in the current uncertain macroeconomic environment.
The company is supporting clients in their sustainability transitions, with the volume of sustainable finance mobilized rising 19% from the first half of last year to €68 billion.
There are still shortages of houses.
Growth Opportunities and Strategies
The company grew the mobile primary customer base by more than 300,000 customers.
The company is allocating more capital towards the Retail Banking business line.
The company is focused on further diversifying its income streams.
The company is taking proactive measures to ensure it continues to operate efficiently, while also selectively investing for growth.
The company is broadening its product foundations.
The company is increasing its mobile primary customer base.
The company is allocating more capital towards more profitable Retail Banking business.
Financial Guidance and Outlook
The company is well on track to reach its target of 4% per annum, with 7% annualized growth in customer balances in the first half of the year.
The company confirms its €5 billion fee income target for 2027.
The company is confident that it can grow at the higher end of its 5% to 10% range this year.
The company confirms its outlook for total income and expects to be roughly stable compared to 2024.
The outlook for CET1 remains unchanged for the year at 12.8% to 13%.
The company now forecasts total expenses to end up at the lower end of the range it gave earlier, including incidental items recorded in the first half of 2025.
The company expects commercial NII to grow in the second half of this year.
The company feels confident that it can grow fees at the higher end of its 5% to 10% range this year.
The company now expects to deliver a healthy return on equity of around 12.5% in 2025.
The company expects to reach its annual growth target of 1 million in 2025.
