ING preparing to sell ING Direct USA
AMSTERDAM (Reuters) - Bancassurer ING (ING.AS) said it was preparing to sell online banking business ING Direct USA, part of a plan to raise funds to repay Dutch state aid.
ING shares were up 3.0 percent by 1215 GMT (7:15 a.m. ET) on Wednesday after the New York Post reported the Dutch financial services group had started the process to auction its U.S. online banking unit in a sale that could raise as much as $10 billion.
The Post said a number of strategic institutions had shown an interest in buying ING Direct USA, including U.S. consumer lender CIT Group (CIT.N).
ING was forced to split its insurance and bank operations and agreed to divest ING Direct USA by 2013 as part of European Commission approval for 10 billion euros ($14 billion) of Dutch state aid received in 2008 during the financial crisis.
"We are preparing for divestment (of ING Direct USA) to comply with the EU agreement," spokesman Raymond Vermeulen said.
Vermeulen would not comment on the size of the deal, possible interested buyers, or the appointment of specific advisers, other than that part of the preparation process for divestment was the appointment of advisers.
The Netherlands paid nearly 40 billion euros to rescue the domestic financial sector in 2008 when it was forced to nationalize ABN AMRO ABNNV.UL and provide capital injections for Aegon (AEGN.AS) and SNS Reaal SR.AS as well as ING.
ING has already announced several divestments.
On Monday, it outlined plans for the expected early repayment of state aid, saying that by May it will have repaid 7 billion euros of the 10 billion, with the remaining 3 billion to be repaid by May 2012.
Early repayment is an important step for the banking and insurance group. Once free of state shackles, a European ban on acquisitions will be lifted and ING will have more pricing flexibility, allowing it to compete more easily.
(Reporting by Sara Webb; Editing by Dan Lalor)