Prague, 2nd February 2012

Restructuring Leasing Portfolios

Bas Hoekstra

Head of Product Management

Keeping up with Stakeholder demands

Background - Company overview

Profile ING Lease

ING Lease is a product of ING Bank providing asset-based finance solutions to its clients on a pan-European scale. ING Lease operates under the brand name ING Lease providing financial and operating lease services:

BackgroundWholly owned by ING Bank N.V.

Scale € 17.6 Bln

Tradingparent trading in Amsterdam (INGA)

Target Customers

SME, Mid Corporate and Corporate segments, present in 16 European countries

Route to MarketBank channel, Direct, Vendors, Intermediaries

Number of fte 1527

Number of Clients

170,000

Key player in Europe

ING Lease is the 6th largest leasing company in Europe according to the Leaseurope 2010 ranking, which is based on new production volume.

Rank Company Name

1 BNP Paribas Equipment Solutions

2 UniCredit Leasing S.p.A.

3 SG Equipment Finance

4 Volkswagen Leasing GmbH

5 Deutsche Leasing

6 ING Lease

7 CREDIT AGRICOLE LEASING

8 De Lage Landen International B.V.

9Leasint – Centro Leasing Banca “Gruppo ISP”

10 Nordea Finance

2

3

The current environment challenges status quo…

Political

Regulatory

• Ultimate capital targets under Basel III, including SIFI buffers, not yet known

• Ultimate rules on liquidity and funding not yet clear

• Additional measures under discussion

Economic

• Ongoing crisis in the Eurozone

• Longer term solutions require strong European leadership

• Elections pending in major global economies in 2012

• Sovereign debt crisis ongoing

• Volatility in financial markets

• Very uncertain short-term economic outlook in EU, US and Asia

Restructuring Leasing Portfolios - February 2012

Adapting to the new environment

Customer Centricity

Operational Excellence

Balance Sheet Optimisation

This implies rethinking of ideal portfolio make up

4

We have aligned our business closer to the bank’s

Which implies:

Hierarchical changes and functional steering.

Product Management organisation instead of a holding organisation.

Recognition of RWA benefits of the product.

Aligning to client base of the bank where feasible and profitable.

Tapping in to distribution network where efficient and cost effective.

Adapting to target segmentation local bank

Restructuring Leasing Portfolios - February 2012

Bank onlyBank only

Bank and leasing presenceBank and leasing presence

Bank and leasing closer aligned presence Bank and leasing closer aligned presence

Deposits (total corporate)

Example ING Poland

16,5

14,5

7,4

6,7

5,3

4,6

4,6

3,9

3,5

3,1

15,0

13,8

7,0

6,8

6,5

4,1

2,9

2,7

2,7

2,6

Loans (total corporate)

PKO BP

Pekao

BZ WBK

Citibank

Millennium

Raiffeisen

BRE Bank

BGŻ

Nordea

Pekao

PKO BP

BRE Bank

BZ WBK

Raiffeisen

Millennium

Kredyt Bank

Citibank

Getin

Bank is leading market player

Restructuring Leasing Portfolios - February 2012, Market share, Sept. 2011, % Source: NBP; DMK5

No Company name Market share

1 Europejski Fundusz Leasingowy S.A. 14,7%2 Raiffeisen Leasing Polska S.A. 11,8%3 BRE Leasing Sp. z o.o. 7,9%4 Pekao Leasing Sp. z o.o. 7,3%… 16 1.7%

Vehicles in 2010 (production)

No Company name Market share

1 Europejski Fundusz Leasingowy (EFL) 9,3%2 Millennium Leasing Sp. z o.o. 8,0%3 Siemens Finance Sp. z o.o. 7,8%4 BZ WBK Finanse&Leasing S.A. 6,9%… 14 3.6%

Machinery & Industrial in 2010 (production)

NoCompany

Market share (%)

1 Europejski Fundusz Leasingowy 11.92 Raiffeisen Leasing Polska 9.33 BRE Leasing 7.14 Pekao Leasing 6.35 Millennium Leasing 6.26 ING 5.0

Total ranking based on portfolio in 2010

ING Lease in top 10

Historically a mismatch in target segments

Asset mix within portfolio changes over time to balance out more evenly.

New support system for standardised lease product.

Extension/ development of Small Ticket Leasing capability for the Retail Bank Clients and part of the Corporate business.

New back office system - current system not able to support future growth strategy.

Change of distribution model - Sales increase via Corporate & Retail Bank

ING Lease specialised product staff in all Corporate and Retail Bank regions.

Leasing KPIs for Bank Account Managers

Operational Excellence:

FTE impact; Shift to smaller transactions results in substantial increase in number of contracts requires different capabilities for sales & servicing.

0,0%

5,0%

10,0%

15,0%

20,0%

25,0%

30,0%

35,0%

40,0%

2011 2012 2013 2014

Real Estate Machinery Vehicles Other movables

New production per asset group (as % of total new production)

Restructuring Leasing Portfolios - February 2012 6

Ranking largely due to excellent Real Estate presence. Lease used to target a different market segment than the

bank. Ambition: top 4 leasing company in the market

measured in production; number 3 in portfolio size.

To achieve that: Market share in vehicles, machinery & equipment needs

to be increased. Leading position in real estate and rolling stock needs to

be maintained.

It will result in a restructure of the portfolio mix: 40-60 RE-Movables vs 70-30 today

Ranking largely due to excellent Real Estate presence. Lease used to target a different market segment than the

bank. Ambition: top 4 leasing company in the market

measured in production; number 3 in portfolio size.

To achieve that: Market share in vehicles, machinery & equipment needs

to be increased. Leading position in real estate and rolling stock needs to

be maintained.

It will result in a restructure of the portfolio mix: 40-60 RE-Movables vs 70-30 today

Utilise bank sales network better

Bielsko-Biała1

ING Lease 2011

Corporate Sales Force 27

Retail Sales Force 13

ING Bank Slaski 2011

Corporate Sales Force 850

13 regions

12 Corporate Banking Centres

32 Corporate Branches

Commercial Banking 115

3 regional hubs

Lease financing integrated part of ING internet offering

Trade Finance » Project

ING Direct Business Credit »ABL One Face »

corporate lending »

« Front End« ING Direct Business« Electronic applications« Account opening on ING website« e-INGvoicing« on-line Trezor

« e-CustodyFX Trader »

ING BusinessOnLine as main Internet tool to offer all corporate products including Lease Internet / Contact Centre as main channel to service simple product clients Straight-through-processing

Restructuring Leasing Portfolios - February 2012 8

Provide Lease on

ING internet s

ite

Provide Lease in

ING BusinessOnLine

(better service)

Provide Lease in Fast Track credit

process

(x-sell)

Enable the bank relationships managers to

offer lease (ABL) products on the same basis

Simplify and automate credit process for

Lease products offered for ING Bank

customers

Improve the efficiency of Lease processes =>

50% of ABL products credit decisions via short

credit process in Fast-Track

Main goal: Increase sales of Lease products among Bank Clients

Restructuring Leasing Portfolios - February 2012 9

ABL One Face – Leasing facility

Focusing on mid- and small- ticket, bigger number of transactions, local currency ABL Product specification:

cars, trucks, trailers, building machines, forklifts PLN only average transaction – EUR 25 k process consistent with Bank’s procedures

There is a lot to be gained; Major shift – Major Benefits

Balance Sheet

Optimisation

Innovative

Customer Centricity

Better service bank and bank customer

Utilise liquidity and funding directly where it is sourced

Developing distribution channels. Improving operations. Drive for excellence.

Risk Weighted

Assets

From RWA perspective Leases are favourable:

Substitution of loans with leases.

Restructuring Leasing Portfolios - February 2012 10