Savings Hit by Job Insecurity

READING, England, May 23, 2011 -

- Brits Continue to Dip Into Their Savings Accounts

- Increased Cost of Living, Employment Uncertainty and Tax
Hikes Impact Saving

- Britons Continue to Use Savings to Pay Down Short-term Debt,
Although This Has Slowed in 2011

Ordinary people's savings (www.ingdirect.co.uk/savings/)
balances fell by 2.8 per cent in the first three months of the year,
fuelled by increases in the cost of living, concern about tax hikes and
growing unemployment.

Figures from the latest ING Direct Consumer Savings Monitor -
the only measure tracking ordinary Britons' savings levels - shows balances
now stand at GBP1,783, down GBP100 on the same quarter last year. This means
that rainy-day savings have fallen by 12 per cent since ING Direct began
tracking them two years ago.

Commenting on the findings, ING Direct Senior Economist James
Knightley said:

"You would expect to see a downward push on savings levels
post-Christmas, but a like-for-like fall on the same fiscal quarter suggests
that there is more at play than simple seasonal variation."

Increases in the cost of living are the main thing squeezing
household finances, with a big rise (up to 41 per cent) in the numbers using
their savings accounts (www.ingdirect.co.uk/savings/variable_rate/) to
pay for groceries and other everyday costs like fuel.

Another factor is increased job insecurity, which is
contributing to Britons desire to re-balance their finances by using savings
to pay down their short-term debt. This continues a trend that was seen
throughout last year, when unsecured borrowing fell by nearly five per cent
(4.6 per cent). However, it has slowed markedly this quarter to a fall of
just 0.2 per cent.

Nevertheless, nearly one in five (18 per cent) say that they
have used their savings in this way, with one in six (15 per cent) 'not
confident' of keeping their job, a level of concern last seen at the lowest
point of the recession in late 2009.

ING Direct CEO Richard Doe comments:

"As the cost of living increases, people are continuing to
face a difficult balancing act and are sensibly continuing to pay down their
short-term debt, albeit more slowly than last year. As usual, something has
to give and it is people's rainy day savings funds that have fallen to
GBP1,783, one of the lowest figures recorded since tracking began.

"The positive news is that nearly a third (31 per cent) say
that they are determined to build up their savings later in the year and if
the economic situation improves they will be in a much better position to do
this."

Commenting on the future outlook, ING Direct Senior Economist
James Knightley continues:

"Increases in VAT and petrol prices were also always going to
put downward pressure on savings levels. Wages aren't keeping pace with the
costs of living, which means that many households are running down their
savings to pay for necessities. However, if the economy begins to improve
this will empower consumers to start re-building their savings buffers and
it's clear from the research that this is what they intend to do."

The figures demonstrate that the young and those on lower incomes have
been particularly seriously affected by the savings squeeze, partly because
these groups have been hit disproportionately hard by increases in
unemployment.

The savings of those aged between 18-24 have fallen by a full 40 per cent
in the past 12 months to just GBP496, while those earning less that GBP22,000
a year have seen their savings fall by GBP155 over the same period (down to
GBP595).

Headline Figures

               Median Savings            Change

    Q1 2009    GBP2,020                     -
    Q1 2010    GBP1,886                   -6.6%
    Q1 2011    GBP1,783                   -5.4%

For a full copy of the latest report from the ING Direct Consumer Savings
Monitor, visit www.consumersavingsmonitor.co.uk

Footnotes

All figures quoted are from the findings of the ING Direct Consumer
Savings Monitor. Full methodology can be found in the latest report,
available at www.consumersavingsmonitor.com

The term 'ordinary Briton' is used to illustrate the fact that
the ING Direct Consumer Savings Ratio uses median averages for savings as the
distribution of savings is so strongly skewed by the very wealthy (mean
averages give figures of around GBP20,000).

Sampling methodology

A sample of 1,300 UK adults, fully representative of the UK
adult population is recruited on a monthly basis by PureProfile, one of the
world's leading research panels, with more than 600,000 panellists worldwide.
This sample contains approximately 1,000 savers (approx 25% of Britons have
no savings).

The interviewees are interviewed over the same 7 day period
over the last week of every calendar month. Interviewees are asked an
identical series of tracking questions every month. These tracking questions
commenced in January 2009 and run on a monthly basis. This quarter's findings
come from the results of October, November and December 2010 tracking.

A further representative sample of 2000 UK adults is also questioned in
the midpoint of each quarter, on a quarterly basis.

    For more information please contact:

    Martin Rutland, ING Direct
    Martin.rutland@ingdirect.co.uk / +44(0)1189-381969

For more information please contact: Mark Lowe, Third City, mark at thirdcity.co.uk / T: +44(0)20-3174-1023, M: +44(0)7779-154346