ING Groep NV (INGA) Chief Executive Officer Jan Hommen said the European Union may need to relax demands that financial companies sell assets, given that there’s “no market” for deals as the sovereign-debt crisis worsens.

ING, the biggest Dutch financial-services company, is under EU orders to complete a restructuring program that includes selling its entire insurance operations before the end of 2013. The demand was a condition for approval of its bailout by the Dutch government during the financial crisis of 2008 and 2009.

“When speaking to colleagues that are in similar circumstances, everyone says: we have to do things for which there is no market,” Hommen said at an investor event in Amsterdam today. “If the market says it doesn’t want it, it’s not going to work. At a certain point we’ll have to make that clear,” though it’s “premature” to start talks with the EU now, he said.

Hommen said executives at Royal Bank of Scotland Group Plc (RBS), KBC Groep NV (KBC) and Commerzbank AG had also told him they were having trouble disposing of assets to meet the conditions. European banks should collectively demand the EU relax its rules for every institution rather than ask for “a favor” individually, he said.

IPO Plans

Commerzbank has to sell its Eurohypo property-finance unit by the end of 2014 to meet European Union requirements for approving state aid. Chief Financial Officer Eric Strutz of the Frankfurt-based firm in August said the unit would have trouble funding itself on its own, making a sale difficult.

Commerzbank spokesman Reiner Rossmann said the company hasn’t updated Strutz’s statement.

KBC declined to comment on the remarks made by its peer, according to spokeswoman Viviane Huybrecht of the Brussels-based company. A spokeswoman for Edinburgh-based RBS also declined to comment.

ING is under orders to shrink its balance sheet by 45 percent from 2008 levels by the end of 2013. It received 10 billion euros ($13 billion) of state aid and transferred the risk on 21.6 billion euros of U.S. mortgage assets to the Dutch government. It has repaid 7 billion euros in aid to date, and announced agreements for the sale of its U.S. online bank and most of its Latin American insurance operations.

ING is preparing to dispose of its remaining insurance businesses through initial public offerings, one for the U.S. and one for Europe and Asia.

Difficult Sales

Weak markets mean IPOs are currently unfavorable, even though the units are operationally ready to be sold, Hommen said. The bank has a “dual track strategy” for the insurance assets in case weak demand for IPOs lingers, he said.

ING has also had trouble selling WestlandUtrecht Bank, a Dutch mortgage lender that relies on ING for its financing. That makes it an unattractive asset right now, Hommen said.

When it ruled on state aid in November 2009, the EU indicated it may consider an extension of the 2013 deadline if an IPO for an asset was already underway and more than 30 percent of the shares had been placed.

EU Competition Commissioner Joaquin Almunia told ING in May that he was “very satisfied” and that the Dutch company was most advanced in executing its restructuring, Hommen said in an interview today after his presentation.

An extension of the deadline wasn’t discussed, Hommen said. ING recently filed a progress report, and another meeting with Almunia will take place “soon,” he said.

To contact the reporter on this story: Maud van Gaal in Amsterdam at mvangaal@bloomberg.net

To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net

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