ING Canada CEO Eyes Acquisitions


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ING Canada is in a good position to make an acquisition and has the financial muscle to acquire pretty well any property and casualty insurer in Canada, the chief executive of the home and auto insurer said Wednesday.

Speaking to Reuters after the company said its net profit fell nearly 38 percent in the third quarter, ING Canada CEO Charles Brindamour said ING Canada’s strong balance sheet and lack of debt leave it in a good position to expand its business through an acquisition. “From an operating point of view and an ability to integrate, we could acquire pretty much any company in the Canadian property and casualty insurance marketplace,” he said.

Declining profitability in the industry and the higher cost of capital have created an environment that is conducive to making a deal, he said. “Given our strong balance sheet and the fact that we have no debt, we feel we are in very good position to capitalize on those sorts of opportunities,” he explained.

Brindamour would not offer a specific timetable for announcing an acquisition but said pulling the trigger on an deal “in the near term” is certainly part of its strategy. He said ING Canada, which is 70 percent owned by Dutch banking giant ING Groep, wants to expand in areas where it has strengths, which he added means a deal would likely involve another Canadian company.

ING Canada operates under the ING Insurance, belairdirect and Grey Power brands.

Q3 PROFIT SKIDS ING Canada said Wednesday its third-quarter profit dropped 37.7 percent due largely to investment losses. It also said the profitability of the industry will remain under pressure as a result of increases in claims and weak capital markets.

The company, Canada’s largest property and casualty insurer, said net income was C$57.3 million ($46.6 million), or 47 Canadian cents a share, in the three months ended Sept. 30. That was down from net income of C$92.0 million, or 74 Canadian cents a share, in the year-earlier period.

Operating income for the quarter increased 11.5 percent to C$106.4 million, or 88 Canadian cents a share, from C$95.4 million, or 77 Canadian cents a share. Analysts had expected profit of 87 Canadian cents a share before items, according to Reuters Estimates.

ING Canada said its loss on invested assets was C$62 million for the quarter, compared with C$9.5 million in the same quarter of 2007.

The company said return on equity for the 12-month period ended Sept. 30, a key measure of profitability, dropped to 9.5 percent, from 16.0 percent a year earlier.

Shares of ING Canada were up 17 Canadian cents, or 0.5 percent, at C$31.99 at midafternoon Wednesday on the Toronto Stock Exchange.

($1=$1.23 Canadian) (Editing by Peter Galloway)

By Frank Pingue TORONTO (Reuters) –


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