ING To Cut 1700 Dutch Workforce As It Expands Digital Banking

(RTTNews) - Dutch banking firm ING Group (ING) Tuesday said it would eliminate 1,700 Dutch workforce over a three-year period, as the lender adopts measures to further expand digital banking, strengthen its local advisory capabilities in the branch network and makes additional IT investments in its Dutch retail banking unit.

ING also plans to trim the number of positions employed by external suppliers by 1,075, it said in a statement.

The job losses in the Netherlands are expected to be mostly at the headquarters of ING Retail Banking and in the back offices, call centres and IT departments.

The company said, towards this, it will book a pre-tax redundancy provision of 320 million euros in the fourth quarter of 2014.

The measures follow the company's earlier initiatives in 2011 and 2012, and is expected to lead to significant cost savings in the coming years. Total structural gross cost savings in addition to the existing running programs are expected to be around 270 mln euros.

Ralph Hamers, CEO, said, "We are creating a consistent customer experience by integrating our service channels in the Netherlands and by making a substantial investment to simplify and upgrade our IT systems. Unfortunately, the more efficient way of working will impact many of our employees."

Currently, ING uses different IT systems for mobile app, website, call centre and branches. As a result, all customer information has not been readily available in each channel. By moving to an omni-channel approach, customers can do all their banking digitally and the information will be available across all channels to provide a better, more seamless service.

To support the omni-channel approach and to enhance the reliability, efficiency and agility of its IT systems and operations in the Netherlands, ING will make further IT investments.This will lead to a more simplified IT landscape with standardized IT systems and highly automated processes. It will amount to a total of around 200 million euros from 2015 to 2017.

Earlier this month, the company had reported increased profit for the third quarter, saying that it accelerated repayment of final tranche of core Tier 1 securities after comfortably passing the AQR and stress test.

The stock closed on the NYSE up 1 percent on Monday at $14.34.