Dutch ING Group Wins Battle to Take Over Barings : Finance: Netherlands bank beats out a bid from rival ABN Amro and Smith Barney. Jailed trader Nicholas Leeson prepares to fight extradition.

ING Group of the Netherlands struck a deal to take over Barings a week after England’s oldest investment bank collapsed over bad futures gambling in Asia, it was announced late Sunday.

ING beat out a bid put together by rival Dutch bank ABN Amro and U.S. investment bank Smith Barney. The deal was announced by court-appointed administrators who had been in control of Barings since last Monday.

ING had earlier made a tentative offer to pay a nominal 1 British pound, or $1.60, for Barings--but it would also have to assume liabilities stretching into the hundreds of millions of dollars.

It is not certain if those were the terms of the final deal, which were to be presented today to a High Court judge in London.

Court-appointed administrators had hoped that ING Group, a big financial and insurance concern, would prevail so they could dispose of a messy situation all at once, leaving it to ING to clean things up.

But had ING walked away, the biggest bank in Holland, ABN Amro Holdings, had teamed up with Smith Barney for a joint bid on parts of Barings.

The Dutch bank was understood to have wanted Barings’ corporate finance arm and Baring Asset Management, which handles about $45 billion in clients’ funds, according to a source familiar with the deal. Smith Barney had wanted Baring Securities, the source said.

A rapid settlement was critical. The longer the talks at Barings’ London headquarters dragged on, the greater the risk that its staff of 4,000--the bank’s most valuable asset--would have jumped the sinking ship.

Barings went broke on Feb. 26 after the Bank of England tried but failed to arrange a bailout package to save Barings from its losses on Asian futures markets, estimated at about $1 billion.

Barings blamed Singapore-based trader Nicholas W. Leeson, who bet wrongly that Tokyo stock prices would rise last month.

Leeson, 28, was detained Thursday after an international manhunt and spent the weekend in a Frankfurt jail preparing to fight an attempt by Singapore to extradite him on forgery charges.

Leeson’s German lawyer, Eberhard Kempf, said the charges are “thin” and will be contested. Singapore has 40 days to lodge a formal application to Germany for Leeson’s extradition.

The initial charge against Leeson is that he forged a document confirming the payment of $81 million into a Citibank Singapore account in the name of Barings Futures, according to documents given to German prosecutors by Singapore authorities.

The Financial Times reported in today’s editions that senior Barings executives responsible for controlling risk gave instructions a month before the bank’s collapse for Leeson to reduce his holdings of futures contracts.

A meeting of an eight-man asset and liability committee at Barings’ London headquarters on Jan. 26 indicated concerns over Leeson’s trading on the day he allegedly made his largest purchase of loss-making futures contracts, the newspaper said.

The minutes of the meeting recorded: “Leeson to be advised that position should not be increased, and when possible reduced.”

In fact, Leeson increased his positions substantially in February--allegedly leading to the bank’s collapse.