ING has announced that
the future of its ING Direct operations in the UK and Canada is
under review.

ING Direct has enjoyed
contrasting success in Canada and the UK.

ING Direct Canada has
posted an accumulated profit before tax of €603m ($740m) in the
period from 2005 to the end of 2011.

In fiscal 2011, ING
Direct Canada reported a profit before tax of €110m (albeit a
reduction of 20.8% from the previous year).

ING Direct Canada ended
2011 with 1.8m customers and funds entrusted of €21.6bn (up 5%

Profit before tax peaked
at ING Direct Canada in fiscal 2010 (€139m).

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In the UK by contrast,
business success has eluded ING Direct.

The UK unit of ING
Direct has accumulated losses of €321m since setting up shop in

In that period, it has
only posted a profit in two years (2006 and 2009).

In August 2010, ING said
that it was repositioning its savings business to be profitable
when the low interest rate environment eased.

ING told RBI:

“We are successfully
attracting new savings customers in the UK to our low cost, simple
and high-quality service offering.

“We are currently
investing in additional products to develop a full service
bank that will meet the needs of our customers.”

Since then, ING Direct
customer numbers have actually fallen in the UK while a possible
move into the competitive current account sector never

In fiscal 2011, ING
Direct UK posted a loss before tax of €46m (2010: loss of

Funds entrusted at ING
Direct fell by 7.3% to €13.9bn at the end of 2011 from €15.0bn at
the end of 2010; at their peak, customer numbers remained flat at

Average balances per UK
savings client have continued to decline sharply, down to just
under €10,000 in the fourth quarter of 2011, from €20,000 in the
fourth quarter of 2007. At the end of 2006, the average UK customer
balance was €38,000.

ING said that the future
of its direct banking units in Australia, Austria, France, Germany,
Italy and Spain were not under review.

ING kicked off 2011 with
the sale of its direct banking arm in the US to Capital One for

ING is still to repay
€3bn of state aid to the Netherlands government having received a
bailout following the banking crisis of 2008.