Lloyds TSB staff in Scotland are waiting to hear how they will be affected by the company's plans to cut 3,000 jobs UK-wide.

The losses have been announced despite reported earnings of £3.62bn for 1999.

Lloyds TSB is in the middle of a £6.7bn takeover of Edinburgh-based Scottish Widows, which should be formalised next month.

There had also been speculation that it was preparing a bid for the Royal Bank of Scotland, if the Royal failed in its takeover of Natwest.

The bank employs 77,000 people worldwide. Of its 63,000 UK-based employees, about 4,000 work in Scotland.

The group as it exists now is the result of a merger of Lloyds with the Scottish-based Trustee Savings Bank.

It is not immediately clear how many of the redundancies will be north of the border.

Sandy Boyle, of the banking and finance union Unifi, said: "What we're facing is absolutely appalling.

"Individuals deliver profitability for companies and the thanks that they get is that they are effectively consigned to the dustbin."

Increased efficiency

BBC Scotland's business reporter Hayley Millar says the details of job losses may not emerge for some time.

"Often we use the rule of thumb that about 10% of UK-wide announcements apply in Scotland.

"But the truth is that Lloyds TSB may well not have figured out the exact locations of branches and jobs to go," she adds.

The bank said increased efficiency would come from centralising computer operations, the use of internet technology and cutting the number of branches.

Chief Executive Peter Ellwood said: "Competition in the financial services market is now so fierce that we must continuously drive to improve our operating efficiency whilst continuing to grow our revenues."

Plans for internet banking

Lloyds TSB says it will launch a stand-alone internet bank in Europe and will expand its UK online banking services.

The new bank, which will initially be launched in Spain, aims to have one million customers within three to four years.

Lloyds TSB also hopes to have one million UK internet banking customers by the end of the year, up from the current figure of 160,000.

The group will pay a dividend of 26.6 pence to investors, an increase of 20%.

Banks under pressure

Lloyds TSB kicks off the reporting season for UK banks. The sector has been depressed recently, with the share price of most banks falling.

Its shares fell to 644p in early trading on the London Stock Market on Friday, down 42.5p. The shares have been trading as high as 900p in the past year.

The likely takeover of another major High Street bank, NatWest, by its smaller rival, Royal Bank of Scotland, is a sign of the growing pace of consolidation in the sector.

That merger could lead to around 18,000 job losses.

Internet banking is one of the main threats to traditional banks, as it is involves much lower costs than running a large branch network.

Prudential, the UK's largest insurer, has had a huge success in launching Egg, its internet banking operation.