* ING sees 500 mln euro Q3 loss

* Still assessing government capital injection plan

* Shares slump 27.5 percent to 13-year low (Adds details, executive's, AFM comments)

By Gilbert Kreijger and Aaron Gray-Block

AMSTERDAM, Oct 17 (Reuters) - Dutch bank ING (ING.AS: Quote, Profile, Research), the Netherlands' biggest listed bank, said on Friday it expects its first quarterly loss ever, hit by financial market turmoil and falling asset prices, sending its shares to a 13-year low.

As the loss of confidence spread beyond shaky institutions to banks previously considered well-capitalised, ING also said its capital position is in line with targets despite the turmoil in financial markets, which accelerated substantially in the third quarter.

"ING's business model is sound and our commercial performance is solid. However, that does not mean that we are immune to the external environment," Chief Executive Michel Tilmant said in a statement.

"The crisis is far-reaching, and even the healthiest companies are feeling the negative effects."

ING said it expected to post a net loss of about 500 million euros ($674 million) for the third quarter, its first quarterly loss since the group was formed in 1991. A spokesman said ING would still post a profit of around 2.5 billion euros for the first nine months of 2008.