RBS to axe 3,700 branch jobs

| November 2, 2009 | 0 Comments

Royal Bank of Scotland (RBS), which is 70% owned by the taxpayer, has announced it is to eliminate 3,700 positions among its branch staff.

The bank, which along with Lloyds Banking Group is to be broken up, said the redundancies are the equivalent of 14% of its workforce and the job losses are in addition to the 10,000 back-office cutbacks revealed in the UK earlier this year.

RBS said staff were informed of the cuts earlier today and the jobs are to go over a two-year period.

Since the onset of the financial crisis, RBS has axed 16,000 jobs worldwide, including 10,000 positions in the UK.

A spokesperson for RBS said the bank needed to streamline the workforce because it had “30% more staff carrying out administrative duties than competitors. We have underinvested in the branch network in terms of processes.

“We are now improving them as part of a £6bn group-wide investment programme,” she said. We need to improve processes so staff can concentrate on customers,” added the spokesperson.

Details about the future of RBS and Lloyds are to be unveiled tomorrow but over the weekend, Chancellor Alistair Darling said Lloyds Banking Group, Royal Bank of Scotland (RBS) are to broken up.

The new banks will be standard retail banks, focusing on deposits and mortgages with the Government hoping to create more competition within the industry.

According to Mr Darling, the move is the best way to ensure “proper competition and choice” as “half a dozen big providers was not acceptable”.

However, the chancellor said he would only sell parts of the banks when “the time is right”, in order to pay back taxpayers following the multibillion-pound bailout of the sector last autumn.

Analysts believe RBS is likely to sell its NatWest branches in Scotland and its card-payment business, as well as its insurance arm including Churchill, Direct Line and Green Flag.

Assets to be sold at Lloyds could include Cheltenham & Gloucester and Intelligent Finance, its online banking arm.

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