ING offers better prices to ESG-conscious clients with new German project

ING-DiBa AG, the German arm of Dutch lender ING Groep NV, has introduced a new model for pricing financial products that measures clients' environmental, social and governance performance in addition to traditional metrics, such as creditworthiness and profitability.

The model is being tested for foreign exchange products first with a plan to expand it to other assets classes, such as rates, later on, the German bank said in a May 12 statement.

The model is designed in a way that enables ING to offer a better price to corporate clients with a more favorable ESG profile, said Thomas Epple, head of financial markets business in Germany and Austria who is spearheading the pilot project.

The new initiative is bound to attract interest from the market and boost the bank's business with sustainability-oriented companies, said Eddy Henning, head of wholesale banking at ING-DiBa.

The bank's goal is to have more companies include ESG criteria in their financing strategy, which in turn will incentivize those companies to partner with banks that are ESG-focused, Henning said.