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Barings shake-up will cut bonuses

Friday 12 February 1999 19:02 EST
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ING, the Dutch banking and insurance giant, is transferring control of ING Barings, its investment banking arm, from London to Amsterdam as part of a sweeping internal reorganisation sparked by last autumn's huge emerging market losses, writes Andrew Garfield.

In an internal memo circulated yesterday staff were also warned that discretionary bonuses for the year just gone will be "below initial expectations" while in 1999 bonus payments will be tied more closely to overall performance by the firm.

Chief executive officer David Robins, who joined the bank from UBS, is to reorganise its activities on product lines, in a bid to end the squabbling between the geographical fiefdoms that grew up as a result of a ING's mid-1990s spending spree.

The new ING Barings is, Mr Robins said, to be "predominantly client focussed."

The bank insisted that the reorganisation would not result in any further job losses beyond the 1200 cuts announced in October.

ING Barings has seen a raft of top level departures since the firm's emerging market losses came to light. These include Marinus Minderhoud, the previous head of the firm. Since his departure, the global chief operating officer, Peter Bennett, has quit, followed by Jeremy Palmer, the head of equities.

In their memo to staff, Mr Robins and Michel Tilmant, the main board member responsible for corporate and investment banking within ING, acknowledged there had been "errors in judgement and control failures" in 1998.

The group chairman, Godfried van der Lugt, also dismissed talk that the shake-up could herald the closure or sale of ING Barings.

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