SKN | ING Raises 2027 ROE Target Above 16% as Revenue and AI Drive Growth

Key Takeaways:

• ING has raised its 2027 return on tangible equity target to above 16%, from 14%, alongside a revenue target above €26 billion and projected costs of approximately €13 billion.
• Commercial growth is broadening the earnings base, with roughly €100 billion of additional deposits, annualized lending growth of about 8%, and fee income already reaching the bank’s previous €5 billion 2027 target.
• AI, retail banking and capital discipline are central to the strategy, while ING remains focused on organic growth and selective bolt-on acquisitions rather than large-scale expansion.

Higher ROE Target Reflects Stronger Commercial Momentum

ING Group has raised its 2027 return on tangible equity target to more than 16%, compared with the 14% objective presented at its 2024 Capital Markets Day.

CEO Steven van Rijswijk attributed the improved outlook to stronger revenue growth, operating scalability and capital discipline. ING now expects revenue above €26 billion in 2027, approximately €1 billion higher than its previous plan, while projected costs are around €13 billion, roughly €300 million below earlier guidance.

The revised targets indicate that management sees stronger commercial activity translating into greater operating leverage rather than relying solely on cost reductions.

Deposits and Lending Are Expanding the Core Franchise

ING has added approximately €100 billion of deposits over the past two and a half years, while lending growth is running at an annualized rate of about 8% year to date.

The bank has more than €700 billion of deposits and a loan-to-deposit ratio of approximately 100%. Management also said around 95% of deposits receive ING’s core rate.

Rather than relying primarily on broad promotional campaigns, ING has increasingly used targeted deposit campaigns designed to attract customers and deepen primary banking relationships. A German campaign during the second quarter generated approximately €8 billion of additional deposits.

That distinction is important for the economics of retail banking. According to management, primary customers typically conduct around three times more business with ING than non-primary customers, making deposit acquisition a broader relationship strategy rather than simply a funding exercise.

Mortgage Growth Supports Retail Banking Expansion

Mortgages remain a significant component of ING’s retail franchise. The bank has approximately €380 billion in mortgage balances and is concentrating growth in markets where management considers returns attractive, including the Netherlands, Germany, Italy and Australia.

Digital capabilities are also being used to reduce processing times. ING said straightforward mortgage applications can be processed in around 30 minutes in some markets. In the Netherlands, agentic AI is being applied to more complex applications, reducing processing time from seven days to five days.

The bank is not managing mortgage economics exclusively through net interest margin. Management said lower-margin, collateralized lending can still generate attractive returns on equity when capital requirements are relatively low.

ING’s lending margin declined from 126 basis points to 124 basis points, which management attributed primarily to changes in the composition of the lending book rather than competitive pricing. Management expects the margin to stabilize during the remainder of the year.

Fees and Investment Services Expand the Wealth Platform

Fee income has developed faster than ING previously anticipated. The bank had targeted approximately €5 billion of fees by 2027 but said it has already reached that level this year. Management now expects an additional €300 million to €500 million in fee growth by 2027.

The investment business is an important component of that expansion. ING’s assets under management have grown to approximately €330 billion, compared with less than €150 billion when van Rijswijk became CEO six years ago.

The bank now has 5.3 million investment customers among 41 million total customers and is consolidating nine investment platforms into a single platform. ING is also selecting global asset-management partners across areas including private credit, private equity, exchange-traded funds and real estate.

For wealth-management clients, the platform consolidation could become relevant if it improves access to a broader range of investment capabilities while creating a more integrated digital experience. The supplied material does not provide specific targets for assets under management or fee revenue beyond 2027.

AI Becomes Part of ING’s Operating Model

ING has approximately 600 employees working in artificial intelligence, including about 300 in a hub in Türkiye. Google is the bank’s principal AI partner.

Beyond mortgage processing, ING expects AI to handle 75% of chatbot traffic, compared with approximately 45% several years ago. The strategy therefore combines operational efficiency with customer-service automation.

The significance for a large European bank is that AI is being integrated into established retail processes rather than positioned solely as an experimental technology initiative. Management’s revised profitability target nevertheless cannot be attributed exclusively to AI, as the updated outlook also reflects lending, deposits, fees, cost scalability and capital allocation.

Capital Discipline Remains Central to Wholesale Banking

While ING continues to support its universal-bank model, management acknowledges that wholesale banking returns need improvement. The division currently generates a return of approximately 11%, with a target of reaching 12% by the end of 2027.

ING plans to diversify wholesale banking beyond lending, particularly through financial markets and transaction services, while continuing to shift capital toward retail banking.

The approach reflects a broader capital-allocation principle: businesses generating stronger risk-adjusted returns receive greater strategic emphasis, while lower-return activities face tighter capital requirements.

Closing Insights

ING’s higher 2027 ROE target reflects a strategy built around several reinforcing factors: stronger lending and deposit growth, expanding fee income, operating scalability, AI adoption and more selective capital allocation.

For HNWIs and international clients, the most relevant development is the expansion of ING’s investment and digital banking infrastructure alongside its traditional European retail franchise. The growth in assets under management and investment customers suggests that fee-based financial services are becoming an increasingly important component of the group’s strategy.

ING remains open to selective bolt-on acquisitions, including its existing position in Spanish private bank Singular and an asset-management acquisition in Poland, but management continues to identify organic growth as the primary engine of expansion. The key measure through 2027 will be whether the stronger commercial momentum and technology investment translate into the targeted improvement in returns while maintaining disciplined capital deployment.

For a confidential discussion regarding retail banking strategy, insurance distribution models, customer loyalty ecosystems, digital financial services, or cross-border financial innovation opportunities, contact our senior advisory team.