ING announced today a further update of its efficiency programme for its Operations and IT activities in the Benelux, mainly relating to ING's banking operations. The goal of this programme is to improve efficiency and to lift ING's banking operations to a higher level of operational excellence. This programme consists of 3 components:

Streamlining: up to 500 FTEs will become redundant within the Operations and IT banking division. Some of these positions are expected to decrease through natural attrition. These redundancies are on top of the 450 redundancies already announced on 13 July 2005.
Outsourcing: approximately 2,200 FTEs are affected. They are expected to be transferred to suppliers.
Downsizing of external staff: contracts for approximately 1.400 external FTEs will not be extended, of which to date 550 have already been ended.

As a result of these initiatives, ING expects cost savings to gradually increase in the coming years, ultimately resulting in annual cost savings of approximately EUR 190 million as of 2008. The estimated non-recurrent costs amount to EUR 120 million over this period. This is on top of the estimated annual cost reductions of EUR 39 million and one-off costs of EUR 57 million, as already announced on 13 July 2005.

Eli Leenaars, Executive Board member ING Group responsible for Operations & IT and Retail Banking said: "ING aims to excel in its services to the customer. To achieve that, we have to excel in execution and be cost efficient. Both sourcing and streamlining fit in ING's strategy of continually looking for ways to reduce costs and improve efficiency to preserve its competitive position, particularly in the mature Benelux market".

"ING is taking its responsibilities towards employees seriously. When we select external parties we take into account both business criteria and social considerations. Labour conditions, career opportunities and the business culture of an external party are important criteria for selection. In the case of redundancies ING will make every effort to help affected employees "from job to job", in line with our Social Plan in the Netherlands and in line with the collective labour agreements in Belgium and the Netherlands", said Eli Leenaars.
The works councils and labour unions have been informed of the intended outsourcing and streamlining initiatives.