ING Group announced today that it had agreed with Fineco/Capitalia of Italy to acquire Entrium, Germany’s second largest direct bank. ING will acquire Entrium through its 70% owned subsidiary DiBa, the oldest and largest direct bank in Germany. The total value of the transaction is Euros 300 million. The transaction is expected to close in the spring of 2003.
ING says Entrium will provide DiBa with considerable additional product expertise as well as scale in on-line stock brokerage, mutual funds and consumer loans. The direct operations of Entrium fit well in the ING Direct concept of selling well-priced, simple banking products via telephone, internet and mail, with a high-rate savings account as its main product. Complementary to DiBa’s centers in Frankfurt and Hannover, Entrium’s Nrnberg center provides the necessary capacity for the two banks’ continued growth in the German market.
“The acquisition of Entrium provides DiBa with a unique opportunity to strengthen its market position as the leading German direct bank”, says Ewald Kist, chairman of ING Group. “Entrium and DiBa make an excellent strategic fit and we are planning to integrate the two companies as quickly as possible to realize the full market potential”, says Hans Verkoren, global head of ING Direct.
DiBa has 1.9 million customers and EUR 21 billion in funds entrusted. Entrium has approximately 965,000 clients and EUR 7.1 billion of total assets. The acquisition of Entrium creates a joint customer base of approximately 3 million clients. Worldwide, ING Direct has now more than 6 million clients and total funds entrusted exceed EUR 65 billion (including DiBa and Entrium).
ING Direct was launched in Canada in May 1997 and is now also active in Spain, Australia, France, the United States, Italy and Germany (through DiBa). The strategy of ING Direct is to be a low-cost provider of financial services via call-centers and the Internet, and ING Direct cafs. ING Direct offers a high-rate, no-fees, no-minimum savings account as its first core product. After reaching a minimum customer base, ING Direct business units complement the savings account by cross-selling a range of other financial products, such as mortgages, mutual funds, e-brokerage, pensions and life insurance.