RBS Feels Bad About Its Firings

Author:
Updated:
Original:

Remember, back in late December, when RBS sent out a holiday card to employees telling them to buck up, because, contrary to what everyone had heard, management would not be taking a "knee-jerk approach" to laying off employees, but rather thoughtfully "re-examining business strategy and resource deployment" and hey, maybe they wouldn't end up firing that many people at all? Well, they thought about it, and here's what they came up with:

RBS is to cut about 4,800 jobs including 3,500 at the investment bank as it jettisons unprofitable units, citing volatile markets and the cost of new U.K. regulation. RBS will sell or close the cash equities, mergers advisory, corporate broking and equity capital markets operations, and is in talks with “a number” of potential buyers for the operation, it said today in a statement. About a further 1,300 jobs are to be eliminated in other areas, including Ulster Bank and corporate lending, said a person with knowledge of the matter. “We are pulling out of business areas that are unprofitable and where we have weaker customer positions than the market leading group of competitors,” Chief Executive Officer Stephen Hester, 51, said in a memorandum circulated to staff and confirmed by an RBS official. “We are also scaling back resources in areas where market developments threaten our ability to fund ourselves sustainably and profitably.”

Other parts of the bank are also shrinking...RBS also said yesterday it would cut 272 jobs at its U.K. Corporate banking unit, about 2 percent of total corporate banking workers, on slowing growth and volatility. The bank plans to cut 40 jobs within its wealth management unit, a person with knowledge of the matter said today. “I am also conscious that other parts of the group are going through difficult people changes too,” Hester said in the memo. “Any decision to reduce roles is deeply regrettable and we will do all that we can to support the affected staff as best we can.”

RBS To Cut 4,800 Jobs [Bloomberg]

Related

Layoffs/Hiring Watch '12: RBS

The bad news is that 600 of the Queen's corgis are being let go. The good news, while it probably comes as little solace to those who will no longer receive birthday chickens, is that 300 or so new ones will be hired in their place. State-backed lender Royal Bank of Scotland is making more than 600 staff redundant as a result of legislation due to come into force at the end of the year, bringing total staff reductions at the bank since its 2008 bailout to around 36,000. RBS, 82 percent owned by the government, said the jobs would go as a result of new UK rules requiring retail financial products such as savings and investment vehicles to be sold by more highly qualified staff and charged a fee. "As a response to this we will be reducing the number of roles by 618 across the UK and creating 351 new roles," an RBS spokesman said on Tuesday. "Having to cut jobs is the most difficult part of our work to rebuild RBS and repay taxpayers for their support. We continue to make efficiencies across our business to deliver greater value toour customers and shareholders," the spokesman added. RBS Job Loss Hits 36,000 [Reuters]

Layoffs Watch '12: RBS

Like Bank of America, RBS has some big goals for the coming year, chief among them being the firing of several thousand investment bankers. (For those skeptical they can do it, according to a PowerPoint presentation presented yesterday, re: the "exits," quite a bit of progress has already been made.) Royal Bank of Scotland, Britain’s biggest government-owned lender, said it will cut 300 more jobs at its investment banking unit and is “on track” with its plan to exit businesses. RBS will eliminate 3,800 jobs at the division by the fourth quarter of next year, compared with an earlier target of 3,500, according to slides based on a presentation delivered by John Hourican, chief of markets and international banking, to analysts Monday. About 3,000 of the cuts will have completed this year, RBS said...The bank’s control of costs is “ongoing,” said Chris Kyle, chief financial officer of markets and international banking, at the presentation. “We will almost certainly hit this year’s number” in terms of the guidance, he said. Royal Bank Of Scotland Cuts 300 More Jobs At Investment Bank [Bloomberg] RBS Markets Investor Roundtable [RBS]