ING maintains a delta hedge book with ING shares in order to minimise the market risks and price fluctuations that arise from the employee option programmes. The hedge book currently holds 49 million (depositary receipts for) ordinary ING shares. ING does not issue new shares to cover employee options. Instead, employees receive shares from the hedge book when they exercise their employee options.
The number of shares required in the delta hedge book varies due to a number of factors, including the value of ING's shares relative to the strike price of the issued options that have vested as well as the number of options that have been exercised, expired or issued.
The delta hedge position is adjusted on a quarterly basis during the open period. The adjustment to the hedge position is done in accordance with regulatory requirements as well as ING's delta hedge policy to prevent market manipulation. The policy limits transactions as a percentage of the total daily trading volume in ING's shares and prohibits ING from conducting the opening trade or from conducting transactions in the last half hour of trading.
In addition to buying shares on the market, ING can also buy shares for the delta hedge book directly from employees who wish to immediately sell the shares they receive on exercising their options. In this case, the shares are bought at the price of the next opening on Euronext Amsterdam.
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Press enquiries: ING Group
Dorothy Hillenius, +31 20 541 6522, dorothy.hillenius@ing.com |
