Allied Irish Said to Raise Job Cuts to 2,500 in Biggest Layoff
Allied Irish Banks Plc (ALBK) is preparing to eliminate as many as 2,500 jobs, 25 percent more than signaled in April, two people with knowledge of the matter said, marking the biggest cuts program in Irish banking history.
The reductions by the nation’s largest state-controlled lender may be detailed as soon as this week, according to the people, who declined to be identified as the matter isn’t public. The increase in departures is in part linked to eliminating overlap in staff working at EBS Ltd, the people said. EBS merged with Dublin-based AIB in July.
Officials at the bank and the Finance Ministry declined to comment. A spokesman for Ireland’s National Pensions Reserve Fund, which holds the state’s stake, declined to comment.
Irish lenders have shed more than 6,000 positions since a real-estate bubble burst in 2008, triggering one of the most costly banking collapses in history. Royal Bank of Scotland Group Plc’s Irish unit and Bank of Ireland Plc are also getting ready to eliminate more jobs.
Allied Irish said in April that it planned to cut over 2,000 staff after posting a record 10.4 billion-euro net loss as a result of soaring bad-loan losses. The announcement of final numbers and severance terms has been delayed as the bank negotiated the package with the finance ministry, the Irish Bank Officials Association has said.
The state has injected 20.7 billion euros ($27.2 billion) into Allied Irish and EBS, giving it a 99.8 percent stake in the company. The 62 billion-euro gross cost to Irish taxpayers of bailing out its banks over the past three years is “unprecedented” globally as a share of the economy’s size, according to Alan Ahearne, an economist who was an adviser to former Finance Minister Brian Lenihan, said.
Allied Irish fell as much as much 9.7 percent in Dublin today, and traded down 3 percent at 11 cents as of 2:31 p.m.
The bank had 14,255 employees at the end of 2010, according to its annual report for that year, excluding staff at its former Polish unit Bank Zachodni WBK SA, which it sold last year. EBS had 616 permanent staff at the same date, according to its annual report.
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