What happened
Shares of Dutch bank ING Groep NV(NYSE: ING) were down by about 9.1% as of 12:58 p.m. ET Monday, likely due to the financial and economic instability Russia is experiencing as a result of the sanctions being imposed on it for invading Ukraine.
So what
ING does have some exposure to Russia, including more than 1 billion euros worth of assets, as of 2020, and foreign currency and interest rate exposure to the Russian ruble, as well.
Since Russia invaded Ukraine, the U.S. and many other countries have sanctioned the country and major institutions within it. Recently, the U.S. and the European Union agreed to ban some Russian banks from SWIFT -- the Society for Worldwide Interbank Financial Telecommunication -- which 11,000 financial institutions use to transfer money to one another.
Image source: Getty Images.
The ruble plummeted by nearly 30% against the U.S. dollar at one point Monday morning before recouping some of those losses. Then Russia's central bank more than doubled its main benchmark interest rate from 9.5% to 20% to support the ruble's value.
Now what
Ultimately, the instability in Russia -- including what's going on with its central bank, the ruble, and SWIFT -- seems to be impacting all international banks with exposure to the country.
Overall, however, I feel good about ING's condition. The bank has a ton of excess capital, and would benefit if the European Central Bank raises its own benchmark rate this year. ING also has a strong dividend which at the current share price yields around 5.5%.
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