The 1.5 million UK customers of the Dutch bank will transfer to Barclays. The ING Direct brand will be phased out over the next two years, during which all accounts will be rebadged Barclays.
The sale had been expected since August when ING said it was to exit the UK market to raise funds to repay some of the state aid taken from the Dutch Government during the financial crisis.
ING launched in the UK in 2003 and marketed its products heavily until its Dutch parent was forced to sell-off assets to raise capital. It won top prize in the financial services category of the 2006 Marketing Week Effectiveness Awards.
About 750 staff will transfer to Barclays. It is not yet known what role marketing director Christian Bohlke and CEO Richard Doe will play at Barclays.
For Barclays, the acquisition is being seen as the first stage in CEO Antony Jenkins’ strategy to rebalance the business with less emphasis on its investment banking arm.
The value of the deal was undisclosed. ING Direct’s savings and mortgage books are worth £10.9bn and £5.6bn respectively.