THIS week's savage job cuts, with 950 axed on both sides of the Border, are the first major move from new Ulster Bank boss Jim Brown who took over as head of Ireland's third-largest bank last April.
Ulster Bank, the Irish arm of UK bank RBS, has been hit hard by the property crash. It has booked loan losses of £2.2bn (€2.66bn) since 2008 and the red ink is still flowing. Ulster Bank has also "parked" £15bn (€18.1bn) of suspect loans, almost 30pc of its total peak loan book, in an in-house 'bad bank'.
In 2009, former chief executive Cormac McCarthy closed Ulster Bank's mortgage-lending subsidiary First Active and cut 1,000 jobs. Now his successor, New Zealander Jim Brown, has struck again, with Ulster Bank announcing a further 950 jobs cuts, of which almost 600 will be in the Republic.
These two rounds of job cuts will result in Ulster Bank's workforce falling by almost 30pc to 5,000 -- by far the steepest reduction in employment numbers at any of the surviving banks.
The Irish banking industry is shrinking at a frightening pace. Way back in 2007, the CSO calculated that there were almost 60,000 people employed in banking and insurance and, apart from the cosseted public sector, banking and insurance employees were the best paid of any group of workers, with average salaries of more than €46,000 a year.
That was then and this is now. The credit-fuelled property bubble burst in 2007, bankrupting the Irish banks and forcing every bank to savagely cut staff numbers.
Bank of Ireland laid off 750 of its staff in 2009. Halifax exited the Irish market with another 750 job losses in 2010 while AIB is waiting for government approval of its redundancy terms before it announces 2,000 job losses.
And the losses haven't been confined exclusively to banking. Aviva, Ireland's largest general insurance company, announced up to 1,250 redundancies in October of last year.
However, despite the constant stream of job-loss announcements from the banks, this week's announcement from Ulster Bank still came as a shock.
Having already said goodbye to 1,000 of their colleagues three years ago, it was widely believed that for Ulster Bank workers the worst of the bad news was behind them.
Unlike the two other large banks still operating in the Republic, AIB and Bank of Ireland, Ulster Bank is foreign-owned, a subsidiary of the UK bank RBS -- which almost certainly explains this week's shock announcement.
Just as AIB and Bank of Ireland had to be bailed out by the Irish Government, RBS had to be rescued by the British government, which ended up with an 83pc stake in the bank. Since being rescued by the British government in 2008, RBS has been cutting costs and disposing of surplus assets.
This week's announcement from Ulster Bank was part of a bigger programme of job cuts at RBS, which also unveiled 3,500 job losses at its investment-banking arm. The latest announcements bring the total job losses since RBS was bailed out to the tune of £45bn (€54.3bn) by the British government to a massive 30,000.
Ulster Bank, which has its head office in Belfast but most of whose operations are now in the Republic, has been foreign-owned since it was purchased by the then London County & Westminster Bank in 1917. It passed to RBS ownership when London County & Westminster's successor NatWest was taken over by RBS in 2000.
For most of the past 85 years Ulster Bank's foreign owners have kept it on a long leash. Mindful of the political sensitivities of operating a Belfast-based bank operating on both sides of the Border, the parent banks were content to let well enough alone.
The dramatic events of September 2008, when RBS came within days of going bust, changed all that. Not alone did RBS have to be bailed out by the British government at enormous cost to the UK taxpayer, it quickly transpired that Ulster Bank -- previously an apparently trouble-free RBS subsidiary -- was one of its worst-performing units as it bankrolled Irish property developers.
Among those who borrowed was Sean Dunne, who in 2005 paid €375m, most of which was lent by Ulster, for the Jurys and Berkeley Court hotels in the leafy Dublin suburb of Ballsbridge.
Following transgressions such as these, it was clear that Ulster Bank would in future be subject to far tighter control by RBS than had previously been the case. The impact of greater central control soon became apparent. In January 2008, just four months after the RBS bailout, Ulster Bank announced that it was killing off former building society First Active, for which it had paid a ridiculous €887m in 2004.
Then in 2011, when Cormac McCarthy quit as chief executive, RBS replaced him not -- as had been the custom -- with another Irish manager, but with Jim Brown, a 30-year banking veteran who had previously specialised in restructuring troubled banks in Australasia and the Middle East.
When Mr Brown's appointment was announced, banking analysts quickly concluded that RBS wanted to speed up the pace of restructuring and cost-cutting at Ulster Bank.
This week's job cuts are the first major manifestation of the new order at Ulster Bank. There is almost certainly more bad news to come.
In common with all of the Irish-based banks, Ulster Bank grew excessively reliant on wholesale funding -- rather than customer deposits -- to finance its loan book. At the end of June 2011, its loans still represented 143pc of its total deposits.
Ulster hopes to get this down to 110-115pc by the middle of the decade. In the current depressed economic environment there is only one way of achieving this goal -- by further reducing the size of its loan book, which still amounted to £37bn (€44.7bn) in mid-2011.
The future for most Ulster Bank customers, in common with those of the other Irish-based banks, is likely to be one of more restricted credit, higher loan interest rates, dearer bank charges and lower deposit rates.
IF the truth be known, RBS would almost certainly dearly love to be shot of its troubled Irish subsidiary. However, with Irish-based banks seriously out of favour with investors, the queue of potential buyers if it were put up for sale any time soon would almost certainly be a very short one. As the recent experience of both Bank of Ireland and Northern Rock has demonstrated, virtually the only buyers for banks currently in the market are bottom-fishers such as Wilbur Ross.
Any sale of Ulster Bank would also be fraught with political difficulties. The sight of a state-controlled British bank dumping its Irish subsidiary in the midst of our current economic difficulties could undo the remarkable improvement in Anglo-Irish relations of recent years.
In practice, the British and Irish governments seem to have agreed an implicit banking pact, under which the British won't pull the plug on Ulster Bank's operations in the Republic while the Irish Government won't dump AIB and Bank of Ireland's Northern Ireland businesses.
That's the good news. The bad news is that under Mr Brown's leadership Ulster Bank and its competitors will continue to ruthlessly cut costs.
This week's announcement from Ulster Bank may have been the first major bank job losses of 2012. They almost certainly won't be the last.