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Northern Rock to axe 680 jobs

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by Kay Mitchell

Crisis-torn Northern Rock has today announced it will reduce headcount by a further 680 as part of another restructure.

According to the lender, which was nationalised in February 2008, the job losses are necessary as part of a cost-cutting exercise and would affect employees “at all grades across the company”.

Less than 2,000 people will work for the bank following the latest job cull – compared to a workforce of 6,500 prior to its bailout in 2008.

The bank collapsed in the autumn of 2007 when savers staged a nationwide run on the bank.

This signalled the onset of the banking crisis and the Rock was subsequently nationalised in February 2008.

At the start of 2010, it was split into two divisions – a “good bank” of profitable assets and “bad bank” of toxic debts.

Earlier this month, the bank unveiled an underlying loss of £232.4 million for the 2010 year for its so-called “good“ bank, although it said it was making progress.

Commenting on today’s job losses, Ron Sandler, executive chairman of the group, said: “Our aim is to minimise compulsory redundancies where possible and we will offer voluntary redundancy.”

The job losses were described as “brutal” by David Fleming, the Unite union’s National Officer.

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News posted: March 28, 2011

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