Thousands of jobs to go - but not in Scotland - if RBS buys Dutch bank
MORE than 6,000 jobs will go at the Royal Bank of Scotland Group if its record-breaking 48 billion bid for the Dutch bank ABN Amro is successful.
The cuts would come from Edinburgh-based RBS’s global banking division, which has staff in London, mainland Europe, the United States and Asia-Pacific.
The organisation made the prediction yesterday as it announced details of its bid - the biggest in the history of banking - as part of a consortium with Belgium’s Fortis and Banco Santander of Spain.
Union leaders from more than a dozen countries will meet on Monday to discuss the impact of the takeover move, which is based on making almost 3 billion in cost savings. “Thousands of staff around the world are caught in the middle of this takeover battle and are watching with growing uncertainty,” said Rob MacGregor, of the banking union Unite.
The RBS consortium has been rebuffed by ABN Amro’s management in favour of an offer from British rival Barclays. But the RBS bid is 3 billion higher than Barclays’ - and it has pledged fewer overall job losses.
A spokeswoman for RBS said a successful bid by its consortium would result in about 20,000 job losses globally, split equally between the three companies. That would leave each of the banks looking at 6,660 job cuts, which RBS hoped would be absorbed by natural turnover and redeployment.
The spokeswoman claimed a winning Barclays bid would result in 23,000 job cuts, of which about 12,000 would come as a result of “offshoring” posts from the UK and the Netherlands. She went on: “We are not able to give an indication of exactly where the affected [RBS] jobs would be, but the only cuts would be in areas where there is overlap with ABN Amro, and that would almost certainly exclude our headquarters in Edinburgh.
“In terms of UK jobs, the global banking division is mostly in the City of London.”
If the consortium’s bid is accepted, RBS, which has nearly 140,000 staff worldwide, will be pushed further up the global league. It is already the second-largest bank in Europe, and the fifth-largest in the world by market capitalisation. It is also the 14th largest company in the world, according to the Forbes Global 2000 rankings.
The RBS spokeswoman said: “Job cuts must be seen in the context of our position in the industry. After the acquisition of NatWest in 1999, we [absorbed] 97 per cent of the 18,000 job losses through redeployment and the creation of new opportunities.”
Mr MacGregor said: “Unions from at least a dozen countries will be meeting at the Unite headquarters on 4 June to develop a cross-border, co-ordinated response to the attempts to acquire ABN Amro. Unite is calling on all parties to provide more details on how the consortium intends to make its projected 2.87 billion cost savings.
“The workforce expects all parties to operate with transparency, to provide them with timely and accurate information and communicate regularly.”
At a news conference in London yesterday, Sir Fred Goodwin, the RBS chief executive, said: “There will be UK job losses as a result of these proposals - it just depends how much of the business we keep here and how much we move to Amsterdam.”
He said the proposed bid would help RBS to achieve its strategy of increasing overseas revenues: if the deal went ahead, 54 per cent of its operating profits would come from overseas, against 42 per cent in 2006.
He was also keen to highlight the advantages of adding ABN Amro’s corporate banking operation to the business, as well as combining the Dutch bank’s LaSalle arm with RBS’s Citizens operation in the US. He said: “This does not just move us into the premier league, but to the top of the premier league.”
Many ABN Amro shareholders are thought to prefer the informal offer of the consortium, which is higher and partly in cash: the Barclays offer is a share swap.
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