ING board still defends CEO's massive pay raise

Jeroen van der Veer, president of ING's board of commissioners, again defended the bank's now scrapped plan to increase the salary of CEO Ralph Hamers from 2 million to 3 million euros per year. The bank has to increase the executives' salaries if it wants to remain an international player, Van der Veer said in the Tweede Kamer on Wednesday, AD reports.

Van der Veer faced disbelieving parliamentarians for around 90 minutes. The MPs had hoped to see some repentance from the commissioner, but were disappointed.

The Netherlands should be proud of ING, as the only remaining Dutch bank that is still present on a global scale, Van der Veer said. He finds it remarkable that the parliamentarians continue to see ING as a Dutch utility bank, while the bank operates world wide and earns a lot of money with other business. Three quarters of ING's staff are not Dutch, he said. If the bank wants to hold on to the best bankers, ING must also be able to offer competitive salaries. "You won't get further on this file if there is no understanding of what it is to be an international system bank", Van der Veer said.

The Tweede Kamer, the lower house of Dutch parliament, could not believe their ears. The MPs have not forgotten how the government had to bail out the banking sector when the financial crisis hit in 2008. ING was given a lifebuoy of 10 billion euros. An amount that ING repaid, with 5 billion euros in interest. But that does not mean it's back to business as usual, according to the MPs. "I get the impression that you don't understand this at all", D66 parliamentarian Jan Paternotte said to Van der Veer.

According to Van der Veer, ING is faced with a dilemma. The bank had to let "ambitious young people in the top" go, because their salaries were not competitive enough. "It does not help if you continue to talk about how bad the bankers are." In his concluding speech, the commissioner called the parliamentarians' attitude "fairly aggressive".

For the time being, ING will not propose a substantial increase for its executives, Van der Veer said to AD after the debate. "That does not have any sense." He plans to talk to the government, which has some explaining to do, he said. According to Van der Veer, the Ministry of Finance has always known that ING would adjust the remuneration policy sooner or later. The advice to make salaries comparable not only with other banks, but also with large international companies, came from the Ministry itself, he said.