ING to Close Retail Banking in Luxembourg

ING announces closure of retail banking operations in Luxembourg, citing lack of sustainable growth in mass retail banking sector.

ING Luxembourg has made the decision to close its mass retail banking offering to private individuals, citing a lack of sustainable growth in this sector. The announcement has caused turmoil among affected customers, who were caught off guard by the sudden news of their account closures. Despite this, ING has assured that it will continue to service clients with mortgage loans, other loans, and investment portfolios. The bank will shift its focus towards growing its wholesale and private banking activities in Luxembourg.

To assist customers with the transition process, ING will increase the number of staff available in its branches and extend the accessibility of accounts beyond the initial two-month deadline. Out of the 124,000 customers listed in the bank's 2022 annual report, 40,000 accounts have already been closed, according to information from trade union Aleba.

The closure of ING's retail banking operations in Luxembourg has sparked discussions about the future of the country's personal banking sector. Other banks, such as Spuerkeess and BIL, have begun taking steps to onboard clients following ING's announcement. The competitive nature of the retail banking industry in Luxembourg, coupled with increasing compliance regulations, poses challenges for banks in maintaining profitability.

Despite these challenges, Luxembourg's banks have seen a significant increase in net profits, driven by rising interest rates. ING has not specified an exact timeframe for the extended deadline for account closures, but it aims to ensure a smooth transition for affected customers.

ING's decision to close its mass retail banking offering reflects the evolving landscape of the banking industry in Luxembourg. As banks navigate regulatory constraints and strive for profitability, the closure serves as a reminder of the need for adaptability and strategic focus in a competitive market.