- CEO's plan to shrink investment bank will see some job losses
- U.K. lender looking to focus on domestic consumer banking
Royal Bank of Scotland Group Plc, Britain’s largest government-owned lender, will eliminate 448 U.K. trading-support roles at its investment bank and move some functions to India to help cut costs at the division, a person with knowledge of the matter said.
The job reductions communicated to staff Tuesday will come from transaction management and operations, as well as some technology functions, said the person who asked not to be identified because the details are private. About 300 roles will be set up in India to replace the U.K.-based positions, the person added.
Chief Executive Officer Ross McEwan, 58, is taking an ax to the Edinburgh-based lender’s corporate and institutional banking unit, exiting 25 countries around the world to focus on consumer and commercial lending in the U.K. and Ireland. He’s seeking to cut annual costs at the division to about 800 million pounds ($1.1 billion) by 2019 from 2.4 billion pounds last year while maintaining revenue to boost profitability.
“Unfortunately the changes will result in some job losses,” a spokesman for the bank said in an e-mailed statement. “We have been restructuring our corporate and institutional bank, as well as reducing its size, to focus on our core customers and products.”
Most of the job cuts will come in London and Newcastle-under-Lyme, England, according to Unite, a union which represents some of the employees. RBS will close its office in the latter town and centralize operations in Manchester in the north of the country, the union said.
“Unite is disappointed that despite RBS’s promise to build a U.K.-focused bank, we continue to see jobs shipped out of the U.K.,” John Morgan-Evans, a regional officer at the union, said in an e-mailed statement. “It was inevitable that RBS’s talk of ‘technology simplification’ would come down to yet more job cuts.”
The bank said it would redeploy staff into new jobs where possible. The Financial Times reported the cuts earlier Tuesday.