ING GROEP NV

19 Equity

Adjustments for hyperinflation

ING applies IAS 29 ‘Hyperinflation’ on its investment in Türkiye since 2022. The IAS 29 indexation impact on

equity was EUR 54 million (2022: EUR 100 million including a one-off impact of EUR 64 million)of which EUR

284 million (2022: EUR 1,011 million)in the currency translation reserve, EUR 0 million (2022: EUR-563

million) in retained earnings, EUR 3 million (2022: EUR-17 million)in revaluation reserves and EUR-234

million (2022: EUR-331 million) in profit or loss.

ING Group Annual Report 2023 on Form 20-FF -276

Share capital and share premium

In 2023, ING Groep N.V. issued 0.0 million ordinary shares (2022:2.9 million and in 2021:3.4 million ordinary

shares). In 2022 and 2021, shares were issued in order to fund obligations arising from share-based

employee incentive programmes. As from 2023 these shares are repurchased from the market. The

cancellation of shares relate to the shares purchased under the share buyback programmes (reference is

made to 'Ordinary shares held by ING Group (treasury shares)').

As at 31 December 2023 ING Groep N.V. has issued USD 7,750 million (2022: USD 6,750 million) Perpetual

Additional Tier 1 Contingent Convertible Capital Securities which can, in accordance with their terms and

conditions, convert by operation of law into ordinary shares if the conditions to such a conversion are

fulfilled. As a result of this conversion, the issued share capital can increase by up to 864 million (2022:750

million) ordinary shares. Reference is made to Note 18 'Subordinated loans'.

Ordinary shares

All ordinary shares are registered. No share certificates have been issued. The par value of ordinary shares is

EUR 0.01. The authorised ordinary share capital of ING Groep N.V. currently consists of 9,142 million

ordinary shares. As at 31 December 2023,3,498 million ordinary shares were issued and fully paid.

Ordinary shares held by ING Group (Treasury shares)

As at 31 December 2023,154.6 million ordinary shares (2022:107.4 million and 2021:128.3 million) of ING

Groep N.V. with a par value of EUR 0.01 are held by ING Groep N.V. or its subsidiaries.

The increase in share premium in prior years, is a result of the issuance of ordinary shares related to share-

based employee incentive programmes. As from 2023 these shares are repurchased from the market.

Other reserves

Revaluation reserves

ING Group Annual Report 2023 on Form 20-FF -277

Equity securities at FVOCI

In 2023, the unrealised revaluation of EUR-35 million (2022: EUR-118 million and 2021: EUR 94 million)

includes revaluation of shares in Bank of Beijing for EUR-24 million (2022: EUR-86 million and 2021: EUR 38

million).

Cash flow hedge

ING mainly hedges floating rate lending with interest rate swaps. Due to a decrease in forward interest rates

in 2023, the interest rate swaps had a positive revaluation of EUR 997 million which is recognised in the cash

flow hedge reserve.

1 Impact of application of hyperinflation accounting under IAS 29.

Net defined benefit asset/liability remeasurement reserve

Reference is made to Note 33 'Pensions and other post-employment benefits'.

Currency translation reserve

1 Impact of application of hyperinflation accounting under IAS 29.

Unrealised revaluations relates to changes in the value of hedging instruments that are designated as net

investment hedges. The hedging strategy is to protect the CET1 ratio against adverse impact from exchange

rate fluctuations. The net decrease of unrealised revaluations and Exchange rate differences of EUR-132

million is related to several currencies including USD (EUR-238 million), TRY (EUR 11 million including EUR

284 million IAS 29 indexation effect), GBP (EUR 18 million), PLN (EUR 169 million), CHF (EUR 37 million), AUD

(EUR-42 million), RUB (EUR-70 million), THB (EUR -13 million), CNY (EUR-16 million)and other currencies

(EUR 11 million).

Share of associates and joint ventures and other reserves

The Share of associates, joint ventures and other reserves includes non-distributable profits from associates

and joint ventures of EUR 815 million (2022: EUR 797 million and 2021: EUR 738 million). Other reserves

includes a statutory reserve of EUR 1,602 million (2022: EUR 2,264 million and 2021: EUR 2,103 million)

related to the former Stichting Regio Bank and the former Stichting Vakbondsspaarbank SPN and a legal

reserve of EUR 628 million (2022: EUR 540 million and 2021: EUR 573 million) related to internally developed

software. The transfer to retained earnings of EUR -892 million includes the release of the Regio bank and

Vakbondsspaarbank SPN reserve of EUR-998 million against regulatory expenses which are recognised in

the statement of profit or loss.

ING Group Annual Report 2023 on Form 20-FF -278

Treasury shares

In 2023 ING Group initiated three share buyback programmes. On 1 March 2023, ING announced a share

buyback programme for a maximum total amount of EUR 50 million. The share buyback programme was

completed by 7 March 2023. In total,3 million shares have been repurchased at an average price of EUR

13.18 per share and for a total consideration of EUR 42 million. The purpose of the share repurchase

programme was to meet obligations under the share-based compensation plans.

The second programme of EUR 1,500 million, commencing on 12 May 2023 and completed by October

2023. A total of 121 million shares have been repurchased at an average price of EUR 12.91 per share

(effective price for ING was EUR 12.36 per share after compensation received from the executing broker).

The shares have been cancelled in December 2023.

Third programme of EUR 2,500 million, commencing on 3 November 2023. As per 31 December 2023 154

million shares have been repurchased at an average price of EUR 12.90 per share and for a total

consideration of EUR 1,982 million. The programme was completed by February 2024. In total 195 million

shares have been repurchased at an average price of EUR 12.87 per share (effective price for ING was EUR

12.83 per share after compensation received from the executing broker). ING has the intention to cancel

these shares in April 2024.

In March 2023 107 million shares (EUR 1,201 million), purchased in 2022, were cancelled.

Retained earnings

1 In 2023, changes in policy following the adoption of IFRS 17 and change in policy for non-financial guarantees. 2022: impact of

application of hyperinflation accounting under IAS 29.

Dividend and other distributions

In 2023, a cash dividend of EUR 2,668 million (2022: EUR 2,178 million and 2021: EUR 1,288 million) and

other cash distributions of EUR 0 million (2022 EUR 1,171 million and 2021: EUR 1,054 million) were paid to

the shareholders of ING Group. For further information, reference is made to Note 29 'Dividend per ordinary

share'.

Other changes

Other changes includes an amount of EUR-3,217 million (2022: EUR-1,983 million;2021: EUR-140 million),

which corresponds to the purchase and cancellation of treasury shares purchased under the share buyback

programmes.

Ordinary shares - Restrictions with respect to dividend and repayment of capital

The following equity components cannot be freely distributed: Revaluation reserves, Net defined benefit

asset/liability remeasurement reserve, Currency translation reserve, Share of associates and joint ventures

reserve and Other reserves including the reserve related to the former Stichting Regio Bank and the former

Stichting Vakbondsspaarbank SPN.

ING Groep N.V. is subject to legal restrictions regarding the amount of dividends it can pay to the holders of

its ordinary shares. Pursuant to the Dutch Civil Code, dividends can only be paid up to an amount equal to

the excess of the company’s own funds over the sum of the paid-up capital and reserves required by law.

Moreover, ING Groep N.V.’s ability to pay dividends is dependent on the dividend payment ability of its

subsidiaries, associates and joint ventures. ING Groep N.V. is legally required to create a non-distributable

ING Group Annual Report 2023 on Form 20-FF -279

reserve insofar as profits of its subsidiaries, associates and joint ventures are subject to dividend payment

restrictions which apply to those subsidiaries, associates and joint ventures themselves.

Non distributable reserves, determined in accordance with the financial reporting requirements included in

Part 9 of Book 2 of the Dutch Civil Code, from ING Group’s subsidiaries, associates and joint ventures are as

In addition to the legal and regulatory restrictions on distributing dividends from subsidiaries, associates and

joint ventures to ING Groep N.V. there are various other considerations and limitations that are taken into

account in determining the appropriate levels of equity in the Group’s subsidiaries, associates and joint

ventures. These considerations and limitations include, but are not restricted to, minimum capital

requirements that are imposed by industry regulators in the countries in which the subsidiaries, associates

and joint ventures operate, or other limitations which may exist in certain countries and may or may not be

temporary in nature. It is not possible to disclose a reliable quantification of these limitations. Without

prejudice to the authority of the Executive Board to allocate profits to reserves and to the fact that the

ordinary shares are the most junior securities issued by ING Groep N.V., no specific dividend payment

restrictions with respect to ordinary shares exist. Refer to Note 47 'Capital management' for further details

of the minimal capital requirements and dividend policy of ING Group.

Furthermore, ING Groep N.V. is subject to legal restrictions with respect to repayment of capital to holders of

ordinary shares. Pursuant to the Dutch Civil Code, capital may only be repaid if none of ING Groep N.V.’s

creditors opposes such a repayment within two months following the announcement of a resolution to that

effect.

Cumulative preference shares (not issued)

Pursuant to the Articles of Association of ING Groep N.V. the authorised cumulative preference share capital

consists of 4.6 billion cumulative preference shares, of which none have been issued. The par value of these

cumulative preference shares is EUR 0.01. A right to acquire cumulative preference shares has been granted

to Stichting Continuïteit ING (ING Continuity Foundation).

The cumulative preference shares rank before the ordinary shares in entitlement to dividend and to

distributions upon liquidation of ING Groep N.V.

The dividend on the cumulative preference shares will be equal to a percentage, calculated on the amount

compulsorily paid up or yet to be paid up. This percentage shall be equal to the average of the euro short-

term rate (€STR) as calculated by the European Central Bank during the financial year for which the

distribution is made; this percentage being weighted on the basis of the number of days for which it applies,

and increased by 2.585 percentage points.

If, and to the extent that the profit available for distribution is not sufficient to pay the dividend referred to

above in full, the shortfall will be made up from the reserves insofar as possible. If, and to the extent that,

the dividend distribution cannot be made from the reserves, the profits earned in subsequent years shall

first be used to make up the shortfall before any distribution may be made on shares of any other category.

ING Groep N.V.’s Articles of Association make provision for the cancellation of cumulative preference shares.

Upon cancellation of cumulative preference shares and upon liquidation of ING Groep N.V., the amount paid

up on the cumulative preference shares will be repaid together with the accrued dividend as well as any

dividend shortfall in preceding years, insofar as this shortfall has not yet been made up. No specific dividend

payment restrictions with respect to the cumulative preference shares exist.

ING Group Annual Report 2023 on Form 20-FF -280