ING Groep N.V. intends to split its banking and insurance operations, divest itself of the insurance operations, and find a new home for its ING Direct USA Internet banking unit.

ING, Amsterdam, would end up being about as half as big as it used to be, with a focus on banking outside the United States. To get rid of the the insurance operations and the U.S. Internet banking business, ING may sell some businesses to other companies and sell other businesses to the public through stock offerings, according to ING Chief Executive Officer Jan Hommen says

One of the companies that merged to form ING in 1991 entered the U.S. insurance market in 1966, by acquiring Life of Georgia. ING became a much bigger presence in the U.S. insurance market in 1997, when it acquired Equitable Life Insurance Company of Iowa, Des Moines, Iowa. In 2000, the Dutch financial services giant further expanded its presence by acquiring ReliaStar Financial Corp., Minneapolis, and the financial services operations of Aetna Inc., Hartford.

ING sold Life of Georgia to a unit of Prudential P.L.C., London, in 2004, and it recently announced plans to sell ING Re’s U.S. and Canadian group life, accident and health reinsurance business to Reinsurance Group of America Inc., Chesterfield, Mo.

But ING is still a significant presence in the U.S. retirement services, life insurance and rollover annuity markets.

ING says it came up with the current restructuring plan in an effort to implement a “Back to Basics” streamlining initiative, eliminate “double leverage,” and pay the Dutch State back for the rounds of government financial support that ING has received since the current financial crisis began.

ING also came up with the plan to satisfy European Commission fair competition requirements, Hommen says.

“Negotiations with the European Commission on the restructuring plan have acted as a catalyst to accelerate the strategic decision to completely separate banking and insurance operations,” Hommen says.

Originally, combining banking and insurance services helped provide capital efficiency and earnings stability, but today, “the widespread demand for greater simplicity, reliability and transparency has made a split the optimal course of action,” Hommen says.

ING managers will be seeking ING shareholder approval for the restructuring plan Nov. 25, at an extraordinary general shareholders meeting in Amsterdam, the company says.

Hommen says ING will try to carry out the restructuring plan in a way that supports the interests of customers, employees, and “providers of capital.”

While the insurance divestiture is under way, the ING insurance business will focus on the life and retirement services businesses in markets such as the United States, the Benelux region, Central Europe and Latin America, ING says.

To get European Commission approval for the restructuring plan, ING must divest the heavily promoted ING Direct USA business by the end of 2013.

“ING regards the operation as a very strong franchise,” ING says.

While the ING Direct USA divestiture is in progress, “ING will ensure that it continues to grow the value of the business and offer a superior customer experience,” the company says.

Once the restructuring is completed, the 2013 balance sheet for the operations that are still under the ING umbrella will be only about 45% as big as the balance sheet for the same operations in September 2008, ING estimates.

But, if the operations grow as expected, the balance sheet for those retained operations may be just 30% smaller than they were in September 2008, ING says.