Ulster Bank could be forced to cut 1,000 jobs after review
Published 03/02/2014 | 02:30
Ulster Bank could cut as many as a thousand jobs from next month once its parent company has completed a review of its business.
Ulster Bank's owner, Royal Bank of Scotland (RBS), is carrying out a full review of all its operations, and will announce its plans for Ulster Bank when it publishes its 2013 results later this month.
RBS, which is 81pc owned by the British government, is under pressure to cut its costs and is set to transfer billions of euro worth of bad loans out of Ulster Bank and into an internal 'bad bank'.
Weekend reports indicate that as part of that review, RBS is expected to significantly reduce a number of departments in Ulster Bank.
Some 400 staff in the corporate debts section and another 350 in its mortgage management unit are considered vulnerable, with smaller, ancillary teams around the rest of the lender also set for the chop.
As part of the restructuring plan, RBS will create an internal 'bad bank' where it will move as much as €47bn worth of so-called 'toxic assets'.
Many of those loans will come from Ulster Bank, which lent heavily in Ireland during the boom.
Those loans will be run down more aggressively than the rest of the bank's performing loans.
The British government has bailed out RBS to the tune of around €54bn since 2008 in an effort to stave off its collapse. About €16.9bn of this has been pumped into Ulster Bank.
Ulster Bank's chief executive, Jim Brown, has already been told by RBS boss Ross McEwan to cut more costs at the Irish business.
Mr McEwan has already warned that Ulster Bank would post a loss of around €3.3bn in the final three months of 2013.
Despite the planned reduction in staff, industry sources suggested last night that at least some of the redundancies would be achieved through natural attrition and not replacing staff who leave.
This will be the third round of cuts at Ulster Bank, which employs just under 6,000 people here.
A company spokesman declined to comment on the potential job losses.
Last week it emerged that Ulster intended to cut 110 jobs at its Dublin mortgage centre in Sandyford, and partially offset those losses with 30 new roles for "field agents" involved in collection work.
The revelation of Ulster Bank's planned cuts came as new figures show that more than 5,000 jobs have gone in the banking sector in the last two years.