RBS Feels Bad About Its Firings

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]