ING Investor Dashboard Sentiment Index shows decline of 54% in 2008

Company Brief

New Delhi, January 19, 2009

ING, the global financial services group, today released data from its quarterly ING Investor Dashboard Survey which shows a significant decline of 54% in investor sentiment in India in 2008.

India’s investor sentiment falls year-on-year to 76 for Q4 2008 from 167 for Q4 2007 as investors react to the Mumbai terror attacks and the global financial and economic turmoil of 2008. The investment sentiment falls below the 100 point level and moves into the pessimistic zone for the first time in India.

The overall pan-Asia (ex-Japan) ING Investor Dashboard Sentiment Index declines 46% in 2008 to 73 for Q4 2008 from 135 for Q4 2007, and registers a fifth quarter-on-quarter fall of 15% to 73 for Q4 2008 from 86 for Q3 2008.

The ING Investor Dashboard is the first quarterly survey in the Asia Pacific region that provides a pan-Asia (ex-Japan) investor sentiment index. The survey is conducted quarterly across 13 markets* in Asia Pacific, and not only provides market insights on investor attitude and outlook but also allows each market to be benchmarked and tracked against the overall investor sentiment across Asia using the pan-Asia index.

Indian investors expect the negative impact of the credit crunch and US economy on their personal financial situation and the local economy to continue in 2009.

The data shows a significant increase in the number of Indian investors who say that the economy and their personal financial status deteriorated in Q4 2008 compared to the quarter before.

·82% of Indian investors say the economy deteriorated in Q4 2008 compared to 11% in Q3 2008

·76% of Indian investors say their personal financial situation deteriorated in Q4 2008 compared to only 5% in Q3 2008

Other than the Mumbai attacks, the data suggests that the key factors behind the decline in investor sentiment for Q4 2008 include the credit crunch, slowdown in the US economy and inflation.

· A significant 89% of the investors say they were impacted by the credit crunch in Q4 2008

· 88% say they were impacted by the US economy in Q4 2008

· While the impact of inflation on investor sentiment in most markets such as China, Hong Kong, Indonesia, Korea, Singapore, Thailand, Japan, Australia and New Zealand decreased in the last quarter, significantly more investors in India (87%) claim their investment decisions was affected by inflation in last quarter

Commenting on the results, Mr. Navin Suri, VP & Director (Sales & Distribution), ING Investment Management India, said, “What happened in Mumbai was a big blow. And coupled with the further deterioration in the global financial markets and economies, it is not surprising to find that investor sentiment in India has reached an all time low. In fact, India was the hardest hit in the last quarter, when compared to the rest of Asia.”

Moving into Q1 2009, Indian investors continue to be less optimistic about the economy and their personal financial status. Many of them are also concerned about the impact of the economic slowdown on job security.

· 71% of Indian investors say they will continue to be impacted by the credit crunch in Q1 2009

· 69% say they will continue to be impacted by the US economy in Q1 2009

· Almost 40% of the Indian investors feel that there will be negative impact with the change in US presidency on their investment decision

· Only 21% expect the US economy to improve in Q1 2009 compared to 52% in the previous quarter

·34% expect the local economy to deteriorate in Q1 2009 compared to only 9% the quarter before

· 36% expect their personal financial situation to deteriorate in Q1 2009 compared to only 4% the quarter before

· 41% say the economic slowdown has had a negative impact on job security

· 67% say inflation will continue to have an impact on their investment decisions in the next quarter

Amidst the current financial meltdown and economic slowdown, more Indian investors view all kinds of risk/return (high-risk, medium-risk and low-risk) investments as unfavorable. Gold however, still remains a popular investment tool.

· 97% of Indian investors invested in gold in Q4 2008 compared to 42% in Q3 2008

· 34% invested in overseas mutual funds and unit trusts in Q4 2008 compared to a mere 1% in Q3 2008

· Investments in real estate substantially increased in the past quarter with 26% of investors investing in local residential real estate (self) in Q4 2008, compared to only 1% in Q3 2008, and 43% in local commercial real estate in Q4 2008 compared to 12% in Q3 2008. Investors, however, indicated they plan to invest substantially less in real estate in Q1 2009

· Investments in allocated pension/annuity also increased to 21% in Q4 2008 compared to only 9% in Q3 2008

· 58% of investors invested in local stocks in Q4 2008, compared to 74% in Q3 2008 and fewer investors say they plan to invest in stocks in Q1 2009 as well

“Going forward, the unfortunate incident of Satyam this month will also further dent confidence but we believe that is only short-term. As long as there are no further such shocks, the markets should remain to normal this year. We do not believe all is doom and gloom for India's stock market or for the economy - India remains one of the world's fastest-growing major economies, with a large domestic consumption base. The country's relatively low dependence on exports limits its direct exposure to the global slowdown, while cheaper oil prices are helping to narrow the current-account deficit. The recent slew of commendable policy measures both by the government and the regulators should begin to take effect in the coming months. While 2009 offers plenty of grounds for concern, there are reasons for hope too,” added Mr. Suri.

China and Taiwan investor sentiment bucks trend in the rest of Asia

Despite the overall drop in investor sentiment in India and across Asia, there was an upswing in sentiment among investors in China and Taiwan, possibly driven by the recent announcements of an economic stimulus packages in each market.

Looking ahead to Q1 2009, data also indicates that China investors may continue to be more optimistic, suggesting that they think China is less influenced by US and global developments.

· 50% of China investors expect the local economy to improve in Q1 2009 and 54% expect their personal financial situation to improve over the same period

· 73% of China investors expect the US economy to impact their investment decisions compared to 88% who indicated so about their investments in Q4 2008

For further information, please contact:

ING Investments

Pankaj Rawat

E-mail: pankaj.rawat@in.ing.com

Tel: +91 22 3982 7964