ING (ADR) (ING) Can Sell Insurance More Than 1x Book Value

Morgan Stanley resumed its coverage on ING Groep N.V. (ADR) (NYSE: ING)(FREE stock trend analysis) with an Overweight rating and a price target of €9, which implies a 37% upside potential.

Morgan Stanley has noted that
1) ING can sell insurance for more than 1x BV
2) At 1x BV for insurance, ING’s share price undervalues the bank at 0.8x TBV, vs. 1.3x for the bank sector and
3) ING is not a forced seller and the free cash offsets the risk of selling the insurance for less than BV.