ING Wavers on Insurance IPO Plan

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ING will not be launching a stock market flotation for its insurance operations any time soon and trade buyers are expressing interest, the Dutch bancassurer said on Thursday.

European Commission regulators seeking payback for the state bailout the bank received in the financial crisis have insisted ING dispose of its €19 billion ($27 billion) insurance portfolio by the end of 2013.

“This is not a good time to do an IPO now. Markets are not receptive. Maybe they will be in the future,” ING Chief Executive Jan Hommen said on a results day that delivered better than expected second quarter profits.

ING will continue with its plans for two separate initial public offerings, one for its U.S. insurance operations, the other for its combined European and Asian business, but he acknowledged that trade sales are a possibility.

“We cannot stop people from calling us. They do, and we talk to them,” Hommen said. Investment bankers told Reuters this week that a trade sale could well net a bigger return.

Last month ING announced the sale of most of its Latin American insurance and investment management business.

The Dutch financial services group on Thursday said it took a €310 million [$441 million] hit on its Greek sovereign bond holdings, holding back a rise in second-quarter net profit, which still beat expectations.

ING reported second-quarter net profit rose 24.4 percent from a year ago to €1.5 billion [$2.1345 billion], thanks to a strong recovery of profits at its insurance unit, and beating analysts’ average estimate of €1.3 billion [$1.85 billion].

ING shares jumped more than 5 percent on the better-than-expected results. The broader Amsterdam market was up about 1 percent.

Private sector investors have agreed to take a 21 percent loss on Greek sovereign bonds maturing before 2020 as part of a Greek bailout agreed by European leaders last month. ING is one of the participating institutions.

French bank BNP Paribas has taken a €534 million [$760 million] charge, while Société Générale recorded a €395 million [$562 million] pretax hit.

ING had about €1.4 billion [$2 billion] of Greek state debt at the end of March.

The Dutch bank said it would not pay an interim dividend, in line with analyst expectations, citing an uncertain financial environment, “increasing regulatory requirements”, and its aim to repay Dutch state aid received in 2008.

ING still needs to repay €4.5 billion [$6.4 billion] to the state, which includes the final amount owed plus a 50 percent premium. It has said it plans to repay in full by May 2012.