ING Group Sells US Operations To Rival ABN Amro

January 30, 2001 (PLANSPONSOR.COM)-ING Group will sell its US operations in ING Barings to Dutch rival ABN Amro for $275 million.

Published reports said ING is cutting back its ambitions to be a global investment banker. As part of the sale, ING will be offloading its domestic corporate finance, equities, prime brokerage, and futures and options clearing.

European Cutbacks for ING

Another phase of ING’s global restructuring, involves combining its ING Barings U.K. management operation into ING Europe. That move should see the elimination of some 500 people in the U.K., for a total of 1,000 worldwide. The 1,000 job cuts include 500 in London and 200 in the United States.

While ING appears to be moving out of the investment banking arena, it will maintain its emerging markets businesses in Asia, Central Europe and Latin America. The restructuring now underway is projected to increase profits in corporate and investment banking by 40% in 2001, the company said. ING is taking a $450 million one-time charge as part of the revamping.

Alternately, ABN Amro should see it global wholesale-banking portfolio increase, particularly in the US. Its US market share should move to 2%. According to Nick Bannister, ABN’s head of global equities, said in a conference call today.

ABN Amro Ramps Up American Effort

Bannister said the company’s strategy calls for doubling it its US market share to 4% in the next two to three years. Simultaneously, it will offer its wholesale customers a wider package of integrated global and investment banking services.

In the prime brokerage area, ABN said its equities and corporate finance business in the U.S. will break even in 2001 after the integration of Barings’ U.S. operations. That move is expected to help the company achieve a savings of $20 million annually by 2002.