Dutch banking and insurance group ING said it was planning two initial public offerings for its insurance activities as part of a mandatory split-up imposed because of its state bailout.
"While the option of one IPO remains open, we are going to prepare ourselves for a base case of two IPOs for our insurance business," chief executive Jan Hommen said in a statement.
He said a Europe-focussed IPO would have a solid cashflow combined with strong growth positions in developing markets, while a separate US-focussed IPO would have a strong position in retirement services.
The US business aims to cut costs by 100 million euros per year from 2011 and will be sold through a share offering as soon as earnings and markets have improved.
The split of the group, which still needs to repay half of its 10bn euro Dutch state capital injection, into its banking and insurance businesses will reverse ING's creation through the merger nearly 20 years ago of bank NMB and insurer Nationale Nederlanden.
The separation was imposed by the European Commission as a bailout condition.
ING posted a higher third-quarter underlying net profit as a strong performance by its ING Direct online banking activities offset still sluggish insurance income, but fell slightly short of consensus expectations.
ING Direct swung to a profit of 412m euros from a loss of 358m due to lower impairments.
The banking activities had an underlying pre-tax profit of 1.513bn euros, versus 250m euros last year and a consensus expectation of 1.305bn, due to lower charges and risk costs and healthy margins.
The insurance operations saw operating profit rise to 473 million, versus 393 million last year. There was a 356 million euro charge in the third quarter in Japan and the U.S. Underlying pre-tax profit fell to 18 million euros, from 551 million, and against a consensus of 105 million.
City A.M. Reporter