Digital banking momentum meets margin pressure
- ING reached its 55 percent retail capital allocation target 18 months ahead of schedule.
- The bank added over 377,000 mobile primary customers in the second quarter of 2026.
- Management now targets more than EUR 25 billion of total income and 15 percent ROE for 2027.
- The main pressure points are lower deposit margins, Dutch mortgage competition, wage inflation, and a stronger euro.
- The first major Significant Risk Transfer deal in 2026 yielded a EUR 1 billion RWA benefit.
The app is the growth engine
The bull case is simple. ING is turning mobile banking into deeper customer ties. It added over 377,000 mobile primary customers in the second quarter of 2026. The bank is successfully executing its digital strategy, which includes scaling AI tools like Agentic mortgages and conversational banking to drive scalable growth.
That matters because a primary customer is more likely to use ING for deposits, cards, mortgages, investments, and insurance. More products per customer can lift fee income and make the bank less dependent on lending spreads. The bank has already exceeded its 2027 capital allocation target of 55 percent to retail, reaching it 18 months ahead of plan.
The bear case is that banking math can turn fast. As rates normalize, deposit margins can shrink. Competition is also squeezing new mortgage production margins in the Netherlands, one of ING's home markets. A stronger euro is another drag because it reduces commercial net interest income from non-euro business when results are reported in euros.
The next proof points are clear. Investors should watch whether ING can continue its successful execution of Significant Risk Transfer deals. The first deal in 2026 provided a EUR 1 billion risk-weighted asset benefit, which helps drive capital efficiency. Expansion of wealth management and private banking initiatives in Southern Europe will also test the fee growth plan.
Deposits first, fees next
ING makes money in two main ways. First, it earns net interest income, which is the spread between what it earns on loans and what it pays on deposits and funding. Second, it earns fees from daily banking, investments, insurance, lending services, payments, and capital markets work.
The retail model starts with the app. ING wants people to use it as their main bank, then add more products over time. The bank is rolling out agentic AI for mortgages and conversational banking to improve efficiency and customer experience.
Wholesale Banking serves large companies and institutions with lending, cash management, payments, trade finance, financial markets, and advisory services. In 2025, Wholesale Banking had stronger lending momentum after earlier hesitation from corporate clients, though the focus is now on disciplined capital management.
Where it breaks is also clear. If ING pays more to keep deposits while loan yields fall, net interest income gets squeezed. If wage costs and regulatory costs keep rising, the digital scale benefit takes longer to show up. If credit losses rise in Wholesale or in weaker retail markets, capital returns can slow.
What customers buy
Daily banking and deposits
Current accounts, savings, payment packages, and cards bring customers into the bank. They also provide low-cost funding when deposit pricing stays under control.
Retail mortgages
Mortgages are a large lending product across the Netherlands, Germany, Belgium, and other retail markets. New digital approval tools help, but Dutch production margins are under pressure.
Investment accounts
Investment products are central to the fee growth plan. ING is expanding wealth management through partnerships, including a recent stake in Singular Bank in Spain.
Insurance products
Insurance is used as a cross-sell product for primary customers. It can add fee income without using as much bank capital as loans.
Business Banking
ING serves smaller business clients in several markets and successfully launched Business Banking in Italy, Germany, and Spain.
Wholesale lending and cash management
Large corporate clients use ING for lending, payments, cash management, and trade finance. This segment is optimizing capital through risk transfer deals.
Retail is broad, Wholesale is still big
Segment shares use 2025 total income from the ING 2025 Form 20-F. Retail is split by geography, while Wholesale Banking is one large segment, so the mix should be read as income exposure, not pure profit exposure.
What could go wrong
Deposit margins keep falling
High impact · High oddsING benefited when customer deposits funded a large loan book at good spreads. As rates normalize, customers may demand higher savings rates or move money to better offers. That can lower liability income even if deposit balances grow.
Dutch mortgage competition bites
Medium impact · High oddsING has strong mortgage growth, but new production margins in the Netherlands are under pressure. Mortgages can still produce attractive returns on equity, yet lower margins reduce the income earned on each new loan. If competition stays intense, volume growth may not translate into much profit growth.
The euro gets too strong
Medium impact · Medium oddsING reports in euros but has income and assets in other currencies. A stronger euro can reduce reported commercial net interest income from non-euro markets. Management has noted this as an ongoing headwind.
Costs outrun digital scale
Medium impact · High oddsDigital banking should make ING more efficient over time. The problem is that wage inflation, technology spending, restructuring, and regulatory costs can absorb much of the benefit. If costs rise faster than income, return on equity targets become harder to hit.
Credit losses rise in a weaker economy
High impact · Medium oddsING lends to households, small businesses, and large companies. Tariffs, trade disputes, and geopolitical stress can hurt borrowers and reduce loan demand. Wholesale credit files and weaker retail markets can quickly lift provisions.
In one breath
What is ING Groep?
ING Groep is a Dutch bank with retail and wholesale operations. It serves private customers, small businesses, and large companies through digital banking, deposits, mortgages, investments, payments, lending, and cash management.
Why does ING focus so much on mobile primary customers?
Mobile primary customers use ING as a main bank through the app or mobile site. These customers are more likely to add deposits, investments, insurance, mortgages, and daily banking services, which can raise fee income and loyalty.
What is the biggest risk for ING investors?
The biggest near-term risk is margin pressure. If deposit costs rise or loan pricing falls, ING can grow customers and still see pressure on net interest income.
What should investors watch in 2026?
Watch the 2026 Significant Risk Transfer deals, CET1 capital, Dutch mortgage margins, and commercial net interest income. These will show whether the 2027 income and return targets are still on track.
Sources and research notes
This page combines Finn's company research with public filings and other cited materials. The thesis is reviewed when material company information changes; Finn Scores use the latest available scoring data.
- Thesis reviewed
- August 30, 2026
- Score data
- September 6, 2026
- Reviewed by
- Shivam Bharuka
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