* ING agrees new restructuring terms with European Union
* Deadline to repay state aid extended to 2015, from 2013
* Deadline for insurance sales extended to 2018, from 2013
* Shares rise 2.3 percent
By Gilbert Kreijger and Robert-Jan Bartunek
AMSTERDAM/BRUSSELS, Nov 19 Dutch banking and
insurance group ING has won more time from regulators
to shed assets and repay government aid, avoiding a fire sale
but keeping it under state supervision for longer and delaying
The European Union's competition watchdog agreed on Monday
that ING, which received 10 billion euros ($12.7 billion) of
state aid in the 2008 financial crisis, would have until 2015 to
repay the remaining 3 billion euros, plus a 50-percent premium.
It also gave the Dutch bank until 2018 to sell or list its
insurance and investment management operations, though parts of
these assets must be sold earlier. The regulator had originally
ruled ING should divest the businesses and repay state funds by
the end of 2013 as a condition of approving the aid.
Banks across Europe are selling assets and cutting costs in
a bid to recover from the financial crisis and meet tougher new
regulations. But many are struggling to strike deals amid a
faltering global economy and unsettled financial markets.
Last month Royal Bank of Scotland, also under
pressure from European regulators to sell assets, saw a deal to
sell 316 UK branches to Spain's Santander collapse.
"This is moderately positive in the sense that they don't
have to sell in a weak market," said Tom Muller, an analyst at
private bank Theodoor Gilissen, of the extra time won by ING.
"On the other hand it is a bit negative because they won't
be paying dividends in the near future due to the state aid
repayments," he added.
At 1115 GMT, ING shares were up 2.3 percent at 6.656 euros.
"With all the priorities that we have, I don't think it is
in the interest of shareholders now that we would start paying
dividends," ING Chief Executive Jan Hommen said.
"They would like to see that we pay back the state, that we
pay back the double leverage," he added, referring to capital
used both in the insurance and banking parts of the group.
ING said it would face certain restrictions, such as
limiting its ability to make acquisitions, until 2015 or the
date at which more than 50 percent of each of its insurance and
investment management operations have been divested.
It has already raised several billion euros from the sale of
assets including its U.S. and Canadian online banks and some of
its Asian insurance operations.
Last month, pan-Asian insurer AIA Group Ltd agreed
to buy ING's Malaysian insurance operations for $1.73 billion.
In a separate deal, Hong Kong businessman Richard Li, the
younger son of Asia's richest man, agreed to buy ING's Hong
Kong, Macau and Thailand insurance units for $2.14 billion.