Headhunters advise ING staff to stay calm

Ever since the Dutch bank declared it was &quotreviewing the future positioning of its investment banking activities&quot last Sunday, the future has looked uncertain. But reaching immediately for the telephone may not be the answer.

Gary Goldstein, chairman of the Whitney Group in the US, advises: &quotSit tight and consider your options. Panic can lead to big mistakes.&quot In London, a headhunter that has received calls from skittish ING staff counsels: &quotPeople that are on the telephone now won't get very good terms because they look desperate.&quot

ING's plans for investment banking appear to have foundered over the high salaries demanded by investment bankers. At a press conference last week, Kees Maas, chief financial officer at ING, said the bank accepted market rates, but added: &quot[Bankers] have to earn the money and add value to the company and add value to the shareholder.&quot

The problem faced by ING is familiar to all second-tier banks. Bulge-bracket profits can be elusive, but to retain top staff, pay must remain competitive.

Maas appeared confident that defections would at least be stemmed until the payment of bonuses in February. He hinted that the bank has until this date to clarify its future in investment banking.

But this may be overly optimistic. &quotWind this forward 12 months and there will be one or two discreet units, like the Charterhouse business, still operating. The rest will be left to wither on the vine,&quot says one leading banking analyst. &quotFrankly, if I were an employee I would be on the telephone to a headhunter soon.&quot

For top staff, headhunters may save them the bother. &quotPhones are ringing all day long,&quot says one insider.

The mood is in sharp contrast to the policy statements on ING's website, which promise staff: &quotWe'll do all we can to foster your potential while offering global opportunities that other institutions can only dream about.&quot