Dutch financial services company ING Groep NV is following the lead of its local rival ABN Amro and overhauling its IT and back-office administration operations through a major outsourcing program.

ING plans to cut 500 jobs from its 13,000-strong Operations and IT division in the Benelux countries, and outsource a further 2,200 staff to third-party suppliers. The cuts come on top of 450 domestic IT job losses that ING announced in July.

The company said the job cuts and outsourcing initiatives would result in annual cost savings of around 190m euros ($228m) from 2008, on top of the expected 39m euros ($47m) annual savings to be generated from the earlier cuts. ING’s shares rose 0.8% to 24.29 euros in trading on the Euronext exchange following the announcement.

ING’s latest move comes just two months after ABN Amro revealed plans to cut 1,500 internal technology jobs, transfer a further 2,000 to external vendors, and signed a total of $2.2bn in IT outsourcing contracts. ABN Amro aims to make annual cost savings of 258m euros ($310m) from 2007 as a result.

There are two consortia reportedly bidding for one proposed infrastructure outsourcing plan that will see part of ING’s IT and network support functions handed over to external service providers. The first consortium includes IBM Global Services, Unisys, Centric, and KPN, while the second includes Accenture, Atos Origin, BT Group, and Getronics.

IBM Global Services is in a strong position to capture a share of ING’s outsourcing investment. The IT services giant already manages ING’s IT infrastructure in the US under a seven-year, $600m contract announced in December 2003, and in a separate deal provides market data and applications to ING’s European trading rooms.