ING to Separate Bank, Insurance Units

Updated from 2:49 a.m. EDT

AMSTERDAM (TheStreet) -- Dutch financial services company ING(ING Quote) will move to separate its banking and insurance operations and plans to pay back early about half the aid it received from the Dutch state.

ING said it plans to repurchase 5 billion euros ($7.5 billion) of Core Tier 1 securities in December, financed by an underwritten rights issue of 7.5 billion euros. ING received 10 billion euros from the Dutch government last year to help it weather the financial crisis.

ING said over the next four years it will look to divest itself of all insurance operations, through initial public offerings or sales.

ING also said it expects third-quarter earnings of about 750 million euros, compared with a loss of about euro568 million in the same period a year ago.

Profits were helped by 10,800 job cuts so far this year, but impairments on various investments, notably real estate and derivatives linked to the U.S. housing market, continue to plague results, ING said.

-- Reported by Joseph Woelfel in New York .

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