ING Declines After Report That Thousands of Jobs to Be CutBy and
ING Groep NV, the largest Dutch lender, fell the most in two months in Amsterdam trading after a report that the company will announce thousands of job cuts next week.
The shares declined as much as 4.6 percent, the most since Aug. 2, and were down 2.9 percent at 10.54 euros as of 12:45 p.m. The reorganization would result in more centralized management and may generate billions of euros in savings, Dutch newspaper Het Financieele Dagblad reported on Friday. A spokesman for ING declined to comment.
“The group is currently active in too many markets where it lacks scale,” Matthias de Wit, an analyst at KBC Securities in Brussels, said in a note to clients. “Especially in the challenger and growth segment, many operations are subscale, leading to subpar returns, diluting the group return on equity.”
ING sees opportunities in Belgium, the Netherlands, Germany and Poland, Het Financieele Dagblad said. The lender has doubts about its presence in Turkey, where it lacks scale, while the operations in France and Italy have to prove themselves, according to the report. The Amsterdam-based bank, which employs about 52,000 people, will give details of its strategy during an investor day on Monday.
Chief Executive Officer Ralph Hamers has transformed ING into a bank focused on Europe since he took the job in October 2013. He is seeking to expand lending to consumers and companies outside its home market as record-low interest rates and regulatory demands force the lender to cut costs.
The Bloomberg Europe 500 Banks Index was down 2.4 percent on Friday. The index has declined 26 percent this year, compared to a 15 percent drop for ING.