ING Group keeps real estate finance unit on board

ING Group remains committed to its dedicated property finance unit, Rudolf Molkenboer, global head of ING Real Estate Finance said in an interview with PropertyEU Magazine. 'In January 2010, we took the decision to start integrating ING REF into ING Bank. We want to bring it more into the banking fold and will continue the REF business as such. ING is a strong parent and real estate financing is a banking activity that we will continue.'

Until last year, ING REF was one of the three pillars of ING Real Estate, one of the leading integrated real estate companies in the world with assets under management totalling more than EUR 100 bn. Now it is the only unit whose fate is certain following the split-up last year of ING Real Estate. The other two units, ING Real Estate Development (RED) and ING Real Estate Investment Management (REIM) are allegedly being primed for a possible sale. The break-up of ING Real Estate stems from the restructuring of ING Group following its EUR 10 bn state bailout. Under terms agreed with the European Commission, the group will be split into two separate banking and insurance entities.

Although several large banks are winding down or spinning off their real estate finance units and ING REF recorded a decline in new commercial real estate business last year, Molkenboer insists that the financing unit is still open to business. 'There is a lot of pressure on the commercial real estate lending market at the moment and it is inevitable that there will be less financing available in the coming years. We have the flexibility to think about different strategies and solutions in these times.' ING REF is active in Europe, the US, Hong Kong and Australia and has 13 offices worldwide excluding its activities in the Netherlands.

ING Real Estate Finance (ING REF) saw its new commercial real estate business fall 42% to EUR 4 bn in 2009 from EUR 7 bn the previous year, according to PropertyEU's annual survey of the top financiers in Europe. In terms of outstanding volume, however, ING REF still ranks among the top three players in Continental Europe with EUR 35.2 bn. Eurohypo and Deutsche Pfandbriefbank topped the league in 2009 with EUR 75 bn and EUR 44 bn respectively.

The full interview with Rudolf Molkenboer appears in the September edition of PropertyEU Magazine. Click on the link below to read 'ING RE Finance sees new business decline 40%'.