Stephen Ross’s SJB, Capital One Said to Weigh Bids for ING Direct
Stock Chart for ING Groep NV (INGA)
SJB National Bank, formed by Related Cos. executives, and Capital One Financial Corp. (COF) are among firms that have expressed interest in ING Groep NV (INGA)’s U.S. online bank, said two people with knowledge of the matter.
ING is in talks with several potential bidders, said one of the people, who declined to be identified because the discussions are private. The Amsterdam-based bank is seeking to sell or merge ING Direct with a lending operation and has also talked with General Electric Co. (GE), based in Fairfield, Connecticut, and New York-based CIT Group Inc. (CIT), people with knowledge of the matter said in March.
The European Union has ordered ING to divest its U.S. online lender as a condition of a 10 billion-euro ($14 billion) government bailout. At the same time, ING has been seeking the higher-yielding assets it could get by combining with a lending operation.
ING had been discussing combining ING Direct with Citigroup Inc. (C)’s private-label credit-card business, and those talks have ended, one person said. ING was outbid last year by Toronto- Dominion Bank for Cerberus Capital Management LP’s Chrysler Financial auto lender, said people with knowledge of those talks.
ING’s U.S. bank may fetch at least $10 billion in a sale, JPMorgan Chase & Co. (JPM) analysts said last month. That price would “free up” about 3.4 billion euros for aid repayment. A sale for $12.5 billion would be a “fairer price,” they said.
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SJB, formed in 2009 by Related executives Stephen Ross, Jeff Blau and Bruce Beal Jr., raised about $1.1 billion last year, a person familiar with the matter said at the time. Related, the developer of projects such as the Time Warner Center in New York, also owns businesses including the Equinox fitness chain.
Spokesmen for McLean, Virginia-based Capital One, SJB, New York-based Citigroup and ING Direct declined to comment.
ING Direct had $77.7 billion in deposits at the end of 2010, of which $69.9 billion was held in money market deposit accounts, according to Federal Deposit Insurance Corp. data. Those accounts tend to be sensitive to interest rates.
The bank’s $40 billion in net loans and leases gave it a Tier 1 capital ratio, a measure of financial strength, of 26.8 percent at the end of 2010, compared with an average of 12.7 percent for all banks, according to FDIC figures. The return on assets was 0.3 percent in 2010, less than half the industry average of almost 0.7 percent, according to the FDIC.
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