EU Has ‘Doubts’ About ING’s Risk Transfer Plan - by Matthew Newman and Martijn van der Starre
ING Groep NV, the biggest financial services company in the Netherlands, must overcome “doubts” from European Union regulators that its risk-transfer plan with the Dutch government on mortgage assets complies with EU rules. The European Commission said the Dutch government, which accepted a transfer of risks and cash flows on 21.6 billion euros ($30.1 billion) of mortgage assets from ING, may have overvalued the portfolio. “The commission considers at this stage that it can not dispel its doubts that the approach taken by the independent expert appears to lead to an overvaluation of the portfolio and to an overestimation of the benefit to the Dutch State,” the EU said July 11 on its Web site. The commission gave temporary approval for the Dutch measure on March 31.
The commission said it has doubts about the discount rates used to calculate the cash flows to ING, the house price assumptions that underlie the portfolio’s U.S. mortgages and other valuation methodologies used to assess the real economic value of the illiquid assets that are part of the transaction. ING, which traces its roots to 1743, plans to raise as much as 8 billion euros selling assets, it said in April. The company, which also received a 10 billion-euro lifeline from the Netherlands in October, will sell as many as 15 businesses and exit about 10 of the 48 countries in which it operates.
No comments:
Post a Comment