Dividend and distribution policy

Distribution policy

ING is committed to maintaining a healthy Group CET1 ratio above the prevailing fully-loaded requirement, plus a comfortable management buffer (including Pillar 2 Guidance). At the same time, ING aims to offer a sustainable and attractive return to shareholders.

As announced on November 5th 2020, ING’s distribution policy is to pay-out 50% of resilient net profit (excluding extraordinary items). The 50% pay-out may be in the form of cash, or a combination of cash and share repurchases, with the majority in cash. Additional distributions to be considered periodically, taking into account alternative opportunities, macro-economic circumstances and the outcome of our capital planning.

The aim is to pay a cash-only interim dividend, representing ~1/3 of first half year resilient net profit, with our half year results. The exact form and level of the final distribution will be subject to approval by the shareholders at the Annual General Meeting. Distribution proposals will reflect considerations that are relevant to a capital plan, including expected future capital requirements, growth opportunities available to the Group and regulatory developments. Furthermore, the execution of this policy will comply with prevailing ECB recommendations on shareholder distributions.

Cash payment per share represent gross amounts which are subject to Dutch dividend withholding tax.

Withholding tax mechanics

Cash dividend payments in the Netherlands are subject to 15% dividend withholding tax. Additional distributions in the form of a share buyback are subject to 17.65% withholding tax, however exempted if the cash dividend paid in the calendar year is in excess of a company specific hurdle.

The hurdle is calculated by taking the average cash dividend paid in the last 7 calendar years (-/- the minimum and maximum amount), corrected for annual inflation. If the cash dividend in a calendar year is less than the hurdle, withholding tax on a share buyback will need to be paid on the difference between the hurdle and the amount of cash dividend paid. The tax authorities will assess the implications of the distributions at the end of each calendar year and will not impose withholding tax on a share buyback during the year.

For ING, the cash dividend payments in 2023 have exceeded the hurdle of €~2.8 bln. In 2024, the hurdle is €~3.1 bln.

* ING has adhered to the recommendations by the ECB not to pay dividends or buy back shares from 27 March 2020 until 30 September 2021. The only exception was the payment of €0.12 per share on 24 February 2021, which was allowed by the ECB.
** ADR dividends are presented rounded to the second decimal. More information on American Depository Receipts and related dividends can be found at https://www.adr.com/drprofile/456837103. The applicable foreign exchange rate, and thus the final amount, is determined at the time of the dividend payment.