FORM 11-K
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the Fiscal Year ended December 31, 2004
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ________________ to _________________
Commission file number 1-14642
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
ING 401(k) Plan for ILIAC Agents
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
ING Groep N.V.
Amstelveenseweg 500
1081 KL Amsterdam
The Netherlands
or
P.O. Box 810
1000 AV Amsterdam
The Netherlands
ING 401(k) Plan for ILIAC Agents
Contents of Audited Financial Statements and Supplemental Schedule
I. The following financial statements and supplemental schedule for the ING
401(k) Plan for ILIAC Agents are being filed herewith:
Financial Statements and Supplemental Schedule December 31, 2004 and 2003,
and the year ended December 31, 2004:
Report of Independent Registered Public Accounting Firm
Audited Financial Statements:
Statements of Net Assets Available for Benefits as of:
December 31, 2004
December 31, 2003
Statements of Changes in Net Assets Available for Benefits for the years
ended:
December 31, 2004
December 31, 2003
Notes to Financial Statements
Supplemental Schedule:
Schedule H, Line 4(i) - Schedule of Assets (Held at End of Year)
Signature Page
II. The following exhibits are being filed herewith:
Exhibit No. Description
----------- -----------
1 Consent of Independent Registered Public
Accounting Firm - Ernst & Young LLP
99.1 Certification Pursuant to 18 U.S.C. Section 1350
(Section 906 of the Sarbanes-Oxley Act of 2002)
Report of Independent Registered Public Accounting Firm
Board of Directors
ING 401(k) Plan for ILIAC Agents
We have audited the accompanying statements of net assets available for benefits
of the ING 401(k) Plan for ILIAC Agents (the "Plan") as of December 31, 2004 and
2003, and the related statements of changes in net assets available for benefits
for the years then ended. These financial statements are the responsibility of
the Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. We were not engaged to perform an
audit of the Plan's internal control over financial reporting. Our audits
included consideration of internal control over financial reporting as a basis
for designing audit procedures that are appropriate in the circumstances, but
not for the purpose of expressing an opinion on the effectiveness of the Plan's
internal control over financial reporting. Accordingly, we express no such
opinion. An audit also includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan at
December 31, 2004 and 2003, and the changes in its net assets available for
benefits for the years then ended, in conformity with U.S. generally accepted
accounting principles.
Our audits were performed for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying supplemental schedule of assets
(held at end of year) as of December 31, 2004 is presented for the purpose of
additional analysis and is not a required part of the financial statements, but
is supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. This supplemental schedule is the responsibility of the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in our audits of the financial statements and, in our
opinion, is fairly stated in all material respects in relation to the financial
statements taken as a whole.
Atlanta, Georgia
June 15, 2005
/s/ Ernst & Young LLP
ING 401(k) PLAN FOR ILIAC AGENTS
Statements of Net Assets Available for Benefits
As of December 31, 2004 and 2003
2004 2003
----------------- -----------------
Assets
Investments, at fair value:
Mutual funds $ 19,371,340 $ 16,908,665
Common stock 939,735 293,854
Participant loans 920,821 910,558
Group annuity contract at contract value 5,385,432 2,494,514
----------------- -----------------
Net assets available for benefits $ 26,617,328 $ 20,607,591
================= =================
The accompanying notes are an integral part of these financial statements.
2
ING 401(k) PLAN FOR ILIAC AGENTS
Statements of Changes in Net Assets Available for Benefits
For the years ended December 31, 2004 and 2003
2004 2003
----------------- -----------------
Additions:
Interest and dividends $ 625,738 $ 236,018
Contributions - participants 3,261,476 2,919,276
Contributions - employer 1,097,009 1,030,701
Rollover contributions 66,521 193,376
Net appreciation in fair value of investments 1,988,059 3,917,219
----------------- -----------------
Total additions 7,038,803 8,296,590
----------------- -----------------
Deductions:
Benefits paid to participants 1,011,081 1,374,875
Deemed distribution 17,985 61,447
Administrative expenses - 5,249
----------------- -----------------
Total deductions 1,029,066 1,441,571
----------------- -----------------
Net increase 6,009,737 6,855,019
Net assets available for benefits:
Beginning of year 20,607,591 13,752,572
----------------- -----------------
End of year $ 26,617,328 $ 20,607,591
================= =================
The accompanying notes are an integral part of these financial statements.
3
ING 401(k) PLAN FOR ILIAC AGENTS
Notes to Financial Statements
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1. Description of Plan
General
The following description of the ING 401(k) Plan for ING Life Insurance and
Annuity Company ("ILIAC") Agents, formerly the Agents of Aetna Life
Insurance and Annuity Company Incentive Savings Plan (the "Plan"), provides
only general information. Participants should refer to the Plan documents,
including the Summary Plan Description, for a more complete description of
the Plan's provisions, including those described herein.
The Plan is a voluntary defined contribution plan available to all
full-time insurance salespersons who, as defined in the Plan document, have
entered into a Career Agent Agreement with ILIAC. The Plan is intended to
meet the requirements of Internal Revenue Code ("IRC") Section 401(a). The
Plan contains a salary reduction feature intended to meet the requirements
applicable to cash or deferred arrangements under Section 401(k) of the
IRC. The Plan is subject to the provisions of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA").
ILIAC is the Plan sponsor ("Plan Sponsor") and the ING U.S. Pension
Committee is the plan administrator ("Plan Administrator"). ING National
Trust is the trustee ("Trustee") of the Plan.
Investment Options
At December 31, 2004, the Plan's assets were invested in the following
investment vehicles: ING Fixed Account, ING GNMA Income Fund, ING
Intermediate Bond Fund, Fidelity Puritan Fund, Merrill Lynch Equity Index
Trust, Fidelity Blue Chip Growth Fund, ING Growth Fund, ING LargeCap Growth
Fund, Washington Mutual Investors Fund Class R-5, MFS Capital Opportunities
Fund, AIM Small Cap Growth Fund, ING Index Plus MidCap Fund, ING Index Plus
LargeCap Fund, ING Small Company Fund, ING Real Estate, ING SmallCap
Opportunities Fund, ING Global Science & Technology Fund, ING International
Fund, ING International Value Fund, and ING Market Stock Fund.
Concentrations of Risk
At December 31, 2004 and 2003, the Plan's assets were significantly
concentrated in ING mutual funds and shares of ING Groep N.V. (the
"Company," a Netherlands corporation which is the parent of the Plan
Sponsor) stock (as more fully described below), the value of which is
subject to fluctuations related to corporate, industry and economic
factors.
4
ING 401(k) PLAN FOR ILIAC AGENTS
Notes to Financial Statements
--------------------------------------------------------------------------------
Eligibility
All employees meeting the qualifying requirements, as specified in the Plan
documents, are immediately eligible to participate in the Plan. Generally,
Plan participation is limited to Career Agents, as defined in the Plan
documents.
Participant Accounts
Each participant's account is credited with the participant's contribution
and ILIAC's contribution. ILIAC contributions are based on participant
deferrals and eligible earnings. Each participant's account is also
credited with allocations of Plan investment results. Participant accounts
are reduced by any administrative fee or expenses charged against the
account and are allocated in proportion to the particiant's account
balance. All earnings or losses are allocated to each participant's account
as soon as practicable after they accrue or arise. The benefit to which a
participant is entitled is the benefit that can be provided from the
participant's vested account at the time benefit payments are made.
Vesting
Participants are immediately vested in their contributions plus actual
earnings thereon. Participants who enter into a Career Agent contract with
ILIAC will vest in ILIAC matching contributions over four years of service
at the rate of 25% after the first year, 50% after the second year, 75%
after the third year, and 100% after the fourth year. Participants who
entered into a Career Agent contract with ILIAC prior to January 1, 2002
will vest in ILIAC matching contributions over three years of service at a
rate of 50% after the first year, 75% after the second year and 100% after
the third year. Participants are immediately fully vested when any of the
following occur: (1) reaching age 65 while actively employed, (2) dying
while actively employed, (3) obtaining eligibility for benefits under
ILIAC's managed long term disability plan, or (4) termination or partial
termination of the Plan.
The amount of cumulative forfeited nonvested participant accounts as of
December 31, 2004 and 2003 is $54,541 and $40,981, respectively.
Forfeitures are used to pay Plan expenses as permitted by the Plan
documents.
Employee Contributions
Participants may contribute up to 50% of their pre-tax eligible earnings
for the Plan year. Participants may also contribute eligible amounts
representing distributions from other qualified plans in a tax-free
rollover ("rollover"). Participant contributions, other than rollovers, are
subject to limitations imposed by the IRC.
5
ING 401(k) PLAN FOR ILIAC AGENTS
Notes to Financial Statements
--------------------------------------------------------------------------------
Employer Contributions
ILIAC matches participants' pre-tax contributions at 50% of each
participant's contributions up to the first 6% of total eligible earnings.
The IRC limits can affect certain highly paid participants' eligibility to
receive matching contributions. ILIAC matching contributions are made in
cash, and are allocated with consideration to each participant's investment
elections.
Participant Loans
Subject to the provisions of the Plan, participants may borrow against
his/her account balances provided that the amount requested is at least
$1,000 but not more than the lesser of 50% of the vested balance or
$50,000.
Each loan will bear an interest rate as prescribed by the Plan's applicable
provisions, currently the prime interest rate plus 1%. Loan repayment
periods are for a maximum of five years. Principal and interest are repaid
ratably through commission check deductions.
Deemed Distribution
The Plan treats participant loans that are in default due to a missed
payment, and outstanding loan balances when a terminated participant takes
a distribution, as deemed distributions. In accordance with Internal
Revenue Service ("IRS") regulations, a participant who repays a loan after
a deemed distribution will receive credits pursuant to IRS requirements.
Benefits
Upon termination of service due to death, disability, or retirement, a
participant or his/her beneficiary may elect to receive either a lump-sum
distribution or periodic payments of his/her vested account balances. A
participant may elect to receive his/her benefit in Company stock (defined
as American Depository Shares ("Groep Shares")) to the extent his or her
account is invested in Company stock. As defined in the Plan documents,
certain participants are also eligible for hardship withdrawals, consistent
with the provisions of the IRC.
Administrative Expenses
The Plan is responsible for paying all Plan expenses, unless ILIAC
determines to pay them. Forfeitures may also be used to pay Plan expenses
as permitted by the Plan documents. Administrative expenses, net of
forfeitures, were $0 and $5,249 for the years ended December 31, 2004 and
2003, respectively.
6
ING 401(k) PLAN FOR ILIAC AGENTS
Notes to Financial Statements
--------------------------------------------------------------------------------
Plan Termination
Although it has not expressed any intent to do so, ILIAC has the right
under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA. In the event of Plan
termination, participants will become 100% vested in their Plan accounts.
2. Summary of Significant Accounting Policies
Basis of Accounting
The accompanying financial statements have been prepared using the accrual
basis of accounting.
Investment Valuation and Income Recognition
The Plan provides for investments in Groep Shares, guaranteed investment
contracts ("GICs"), and mutual funds. Mutual funds are stated at fair
value, which is the quoted market price. Investments in Groep Shares are
based on the quoted market price of the common shares of the Company.
Certain investments in contracts with insurance companies (ING Fixed
Account) are stated at contract value, in accordance with American
Institute of Certified Public Accountants ("AICPA") Statement of Position
94-4 Reporting of Investment Contracts Held by Health and Welfare Benefit
Plans and Defined Contribution Pension Plans ("SOP 94-4").
Loans to participants are valued at their outstanding balances, which
approximate fair value.
Interest income is recorded on the accrual basis of accounting. Dividends
are recorded on the ex-dividend date. Purchases and sales of securities are
recorded on the trade date.
Use of Estimates
The preparation of the financial statements in conformity with U.S.
generally accepted accounting principles requires the Plan Administrator to
make estimates and assumptions that affect the amounts reported in the
financial statements and accompanying notes. Actual results could differ
from those estimates.
Risks and Uncertainties
The Plan invests in various investment securities. Investment securities
are exposed to various risks, such as interest rate, market and credit
risks. Due to the level of risk associated with certain investment
securities, it is at least reasonably possible that changes in the value of
investment securities will occur in the near term and that such changes
7
ING 401(k) PLAN FOR ILIAC AGENTS
Notes to Financial Statements
--------------------------------------------------------------------------------
could materially affect participants' account balances and the amounts
reported in the statements of net assets available for benefits.
Reclassifications
Certain 2003 balances have been reclassified to conform to the 2004
presentation.
3. Income Tax Status
The Plan has received a determination letter from the IRS dated March 27,
2003, stating that the Plan is qualified under Section 401(a) of the IRC
and, therefore, the related trust is exempt from taxation. Once qualified,
the Plan is required to operate in conformity with the IRC to maintain its
qualification. The Plan Sponsor has indicated that it will take the
necessary steps, if any, to bring the Plan's operations into compliance
with the Code.
4. Investments
The following individual investments represent 5% or more of the Plan's
total net assets as of December 31:
2004 2003
------------- --------------
ING Small Company Fund - Class I $ N/A $ 3,407,863
ING Fixed Account/GIC 5,385,432 2,494,515
Fidelity Blue Chip Growth Fund 2,585,835 2,650,206
ING Growth Fund - Class I 1,584,649 2,099,963
ING International Value Fund - Class I 3,403,031 2,060,102
ING Index Plus MidCap Fund - Class I 2,324,026 1,200,372
ING Index Plus LargeCap Fund 1,378,534 1,109,705
Washington Mutual Investors Fund - Class R-5 1,610,606 N/A
The net appreciation in fair value of each significant class of
investments, which consists of the realized gains or losses and the
unrealized appreciation on those investments, is as follows for the years
ended December 31:
2004 2003
------------- --------------
Mutual funds $ 1,796,179 $ 3,850,220
ING Groep shares 191,880 66,999
------------- --------------
Net appreciation in fair value $ 1,988,059 $ 3,917,219
============= ==============
8
ING 401(k) PLAN FOR ILIAC AGENTS
Notes to Financial Statements
--------------------------------------------------------------------------------
5. Investment in Insurance Contracts
As of December 31, 2004, the Plan maintained one GIC related investment
option, the ING Fixed Account. This contract is considered to be fully
benefit responsive in accordance with AICPA SOP 94-4 and is carried at
contract value. As of December 31, 2004 and 2003, the fair value of the
investment in the ING Fixed Account is $5,272,306 and $2,494,515,
respectively.
The average yields for the contract for the years ended December 31, 2004
and 2003, were 3.70% and 4.52%, respectively. The crediting interest rates
for the contract as of December 31, 2004 and 2003 were 3.70% and 4.45%,
respectively. The minimum crediting interest rates for the contract for the
years ended December 31, 2004 and 2003 were 3.65% and 4.45%, respectively.
The Fixed Account guarantees that amounts allocated to it will earn a
minimum interest rate, which was 3.65% for 2004. ILIAC makes this
guarantee, and although ILIAC may credit a higher interest rate, the
credited rate will never fall below the lifetime guaranteed minimum of
3.00%.
ILIAC's determination of credited interest rates reflects a number of
factors, including mortality and expense risks, interest rate guarantees,
the investment income earned on invested assets and the amortization of any
capital gains and/or losses realized on the sale of invested assets. A
market value adjustment may apply to amounts withdrawn at the request of
the contractholder.
The underlying contract has no restrictions on the use of Plan assets and
there are no valuation reserves recorded to adjust contract amounts.
6. Parties-in-Interest to the Plan
The Plan holds investments in several mutual funds that are managed by
affiliated companies of the Plan Sponsor. These funds are considered
parties-in-interest (as defined in ERISA) to the Plan. At December 31, 2004
and 2003, funds of $18,622,026 and $14,589,632, respectively, were held in
such investments and are considered parties-in-interest to the Plan.
9.
Supplemental Schedule
ING 401(k) PLAN FOR ILIAC AGENTS
EIN-71-0294708 Plan-005
Schedule H, Line 4(i)
Schedule of Assets (Held at End of Year)
At December 31, 2004
--------------------------------------------------------------------------------
(a) (b) (c) (e)
Identity of Issue, Borrower, Lessor, or Description of Current
Similar Party Investment Value
------ ----------------------------------------- -------------- ------------
* ING Fixed Account ING Fixed Fund/GIC $ 5,385,432
* ING GNMA Income Fund Mutual Fund Shares 221,863
* ING Intermediate Bond Fund Mutual Fund Shares 599,607
Fidelity Puritan Fund Mutual Fund Shares 863,648
Merrill Lynch Equity Index Trust Mutual Fund Shares 908,366
Fidelity Blue Chip Growth Fund Mutual Fund Shares 2,585,835
* ING Growth Fund - Class I Mutual Fund Shares 1,584,649
* ING Large Cap Growth Fund - Class I Mutual Fund Shares 489,154
MFS Capital Opportunities Fund - Class A Mutual Fund Shares 629,940
AIM Small Cap Growth Fund - Class R Mutual Fund Shares 476,086
* ING Index Plus MidCap Fund - Class I Mutual Fund Shares 2,324,026
* ING Index Plus LargeCap Fund (I) Mutual Fund Shares 1,378,534
* ING Small Company Fund - Class I Mutual Fund Shares (6)
* ING SmallCap Opportunities Fund - Class A Mutual Fund Shares 181,709
* ING Global Science and Technology Fund - Mutual Fund Shares 593,129
Class I
* ING International Fund - Class I Mutual Fund Shares 303,871
* ING International Value Fund - Class I Mutual Fund Shares 3,403,031
* ING Market Stock Fund Shares of Company Stock 939,735
* ING Market Stock Fund Mutual Fund Shares 1,217,292
Washington Mutual Investors Fund Class R-5 Mutual Fund Shares 1,610,606
Participant loans 920,821
-------------
$26,617,328
=============
Note: Column (d) cost information is omitted for all participant directed
investments.
* Indicates a party-in-interest to the Plan.
11
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this annual report to be signed on its behalf by the undersigned hereunto
duly authorized.
ING 401(k) Plan for ILIAC Agents
Dated: June 27, 2005 By: ING US PENSION COMMITTEE
-------------
/s/ Darryl Harris
By: -----------------------------------------
Name: Darryl Harris
--------------------------------
Title: Chairman, ING U.S. Pension Committee
--------------------------------------
12
Exhibit 1
---------
Consent of Independent Registered Public Accounting Firm
We consent to the incorporation by reference in the Registration Statement (Form
S-8 No. 333-14254) pertaining to the ING 401(k) Plan for ILIAC Agents of ING
Groep N.V. and affiliates of our report dated June 15, 2005, with respect to the
financial statements and schedule of the ING 401(k) Plan for ILIAC Agents
included in this Annual Report (Form 11-K) for the year ended December 31, 2004.
/s/ Ernst & Young LLP
Atlanta, Georgia
June 22, 2005
Exhibit 99.1
------------
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
(SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002)
In connection with the Annual Report on Form 11-K of the ING 401(k) Plan for
ILIAC Agents (the "Plan") for the year ended December 31, 2004 as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), the
undersigned hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of
such officer's knowledge:
(3) The Report fully complies with the requirements of Section 13(a) or
15(d) of the Securities and Exchange Act of 1934; and
(4) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations
of the Plan.
Date: June 27, 2005 /s/ Scott Burton
------------- ------------------------------------
Name: Scott Burton
Title: Attorney-in-Fact
The foregoing certification is being furnished solely pursuant to 18 U.S.C.
Section 1350 and is not being filed as part of the Report or as a separate
disclosure document. This certification shall not be deemed "filed" for purposes
of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to
liability under this section. This certification shall not be deemed to be
incorporated by reference into any filing under the Securities Act of 1933 or
the Securities Exchange Act of 1934 except to the extent that this Exhibit 99.1
is expressly and specifically incorporated by reference in any such filing.
A signed original of this written statement required by Section 906 has been
provided to the Plan and will be retained by the Plan and furnished to the
Securities and Exchange Commission or its staff upon request.