Tuesday February 10, 05:41 PM
Royal Bank of Scotland to axe up to 2,300 jobs
By Roland Jackson
LONDON (AFP) - Royal Bank of Scotland (LSE: RBS.L - news) , which is majority-owned by the British government, said Tuesday that it will axe up to 2,300 jobs as it looks to recover from the credit crunch and the mis-timed takeover of ABN Amro (Amsterdam: AABA.AS - news) .
"RBS has begun a process of consultation with staff in the UK regarding a restructuring that could lead to a reduction in the number of jobs of up to 2,300," the bank said in a statement.
"This represents around two percent of a total RBS Group UK workforce population of 106,000."
Royal Bank of Scotland was bailed out by the government earlier this year after running into trouble when it tried unsuccessfully to raise funds from shareholders because of the credit crunch.
RBS needed 20 billion pounds (23 billion euros, 30 billion dollars) of public money and is now 68-percent owned by the state.
"This (jobs) announcement does not affect customer facing branch staff," said the group, adding that compulsory redundancies would be kept to a minimum.
News of job cuts came as the bank's former chief executive, Fred Goodwin, apologised on Tuesday to lawmakers for failing to foresee the financial turmoil that led to RBS being rescued.
Goodwin (LSE: GDWN.L - news) told the Treasury Select Committee investigating the financial crisis: "I apologised in full and I'm happy to do so again."
He said there was a "profound and unqualified apology for all of the distress that has been caused."
RBS expects a 2008 annual loss of up to 28 billion pounds (32 billion euros, 41 billion dollars) -- a record in British corporate history -- owing to the crisis and a costly consortium takeover of Dutch lender ABN Amro in 2007.
Regarding the job cuts, RBS UK chief executive Alan Dickinson said: "We recognise that any news of this nature is unwelcome at any time.
"It is essential, however, that we consistently review our business to ensure that we are able to operate as efficiently as possible, especially in the current economic circumstances.
"We will be consulting with our recognised trade union, Unite, and our employees throughout. We fully agree with Unite that we must keep compulsory redundancies to a minimum and we will," added Dickinson
RBS, which will publish its annual results on February 26, said the group was focused on "restoring" its financial health.
"Everyone at RBS is focused on delivering for our customers and restoring the health of the overall organisation," said Dickinson.
"Staff have given everything they have over the last year which makes the decision to cut any job an extremely tough one. We will do everything we can to mitigate the impact on our people and keep job losses and compulsory redundancies to the minimum."
Earlier on Tuesday, former RBS bosses also apologised for their leading role in the disastrous 2007 takeover of Dutch bank ABN Amro for a record-breaking 71 billion euros (100 billion dollars).
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