The Dow Jones report said the ING staff reduction plan eliminates the unit’s individual retirement wholesale distribution channel that sold annuities through broker-dealers and also affects CitiStreet, which it acquired from Citigroup and State Street Corp. in 2008. According to the news account, the cuts amount to a 5% reduction at the company’s U.S. unit, which will employ about 7,600 people when the layoffs are finished.
The chief executive of the U.S. operation, Rob Leary, announced the cuts in a memo to employees alongside a “renewed operational plan” to boost sales and trim back administrative costs at the unit, which sells life insurance and retirement products, Dow Jones said.
In addition, ING is eliminating 200 open positions. “The loss of jobs is concerning for all — especially in this economy at this time,” Leary wrote, according to Dow Jones. “We are committed to treating our departing employees with care and respect.” A spokesman said the cuts “were part of ING’s efforts to sharpen its strategic focus and reduce administrative expenses as it prepares for a U.S.-focused IPO.”
Earlier Wednesday, executives of the parent company made a long-awaited announcement that it will most likely sell off its insurance operations in Europe and the U.S. in two separate IPOs (see ING to Separate Insurance Operations).
ING is being forced by the European Commission to sell them and nearly halve its balance sheet in return for getting approval for the multi-billion euro rescue it received from the Dutch government at the height of the financial crisis, the news report said. The selling of the insurance units, which it expects to complete before the end of 2013, will transform ING into a merely Europe-focused bank, Dow Jones said.