Dutch bank ING has reached an agreement to
sell ING Direct Canada for a total of C$3.1bn ($3.1bn) to Canada’s
third largest lender by assets, Scotiabank.  

According to ING, the transaction is a result
of the lender’s “continuous evaluation of its portfolio of
businesses and is in line with ING’s strategic objectives of
sharpening the focus of the bank” and “strengthening its capital

Jan Hommen, CEO of ING Group, said:
“Scotiabank’s straightforward business model combined with the
innovative and successful ING Direct model make an ideal
combination for a strong future and a solid base for both our
customers and employees.”

Launched in April 1997, ING Direct Canada
serves 1.8m customers and has over 1,100 employees. ING Direct
Canada has approximately C$40bn in assets.

The ING Direct units in Australia, Austria,
France, Germany, Italy and Spain are not affected by the sale of
the Canada unit.

On 2 August,
ING announced that it was “reviewing options” for ING Direct UK

and this review is ongoing.

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Under the terms of the sale agreement,
Scotiabank will pay C$3.1bn in cash for all of the shares in ING
Bank of Canada – the formal name of ING Direct Canada. Earnings of
ING Direct Canada until closing of the transaction will be for the
benefit of Scotiabank.

The sale of ING Direct Canada is expected to
lead to a transaction gain of €1.1bn after tax and a capital
release of €1.4bn at closing for ING.

With assets of C$670bn, as at July 31, 2012,
Scotiabank has more than 81,000 employees and serves a customer
base of over 19m in more than 55 countries across the globe.

The sale of ING Direct Canada is subject to
customary regulatory approvals and is expected to close in the
fourth quarter of 2012.