Europe South Asia Asia Pacific Americas Middle East Africa BBC Homepage World Service Education



Front Page

World

UK

UK Politics

Business

Sci/Tech

Health

Education

Sport

Entertainment

Talking Point

In Depth

On Air

Archive
Feedback
Low Graphics
Help

Wednesday, September 29, 1999 Published at 08:48 GMT 09:48 UK


Business: The Company File

Bank job loss fears grow

Branches could close if Royal Bank of Scotland takes over NatWest

Up to 30,000 jobs in the UK could be lost if the Royal Bank of Scotland takes over NatWest Bank.

This is double the number of jobs that unions fear could be lost if the rival Bank of Scotland proceeds with its hostile £20.8bn bid for NatWest, the Guardian newspaper reports.

The newspaper cites Royal Bank proposals which say they would plan to trim the branch network to 1200. NatWest has a branch network of 1700, compared with Royal Bank's network of 600, so under the proposals over one thousand branches could be shut.

So far, both the Royal Bank of Scotland and the Bank of Scotland has been coy about its plans for the NatWest branches, leading the unions to fear that big cuts are planned.

Strong results

As the Bank of Scotland posted strong first half results, it provided little extra information about its planned bid.

The Bank of Scotland posted a 12% increase in first-half profits to £471m, at the top of analyst expectations.

The bank said of its bid for NatWest, that the combination could be achieved "without large-scale compulsory redundancies".

Chief Executive Peter Burt has previously said he did not envisage "tens of thousands" of job losses.

Given that staff costs are a high part of any bank and the part of the merger motivation will be to cut costs, some job losses seem inevitable.

Bank of Scotland pointed to its strong results as further proof the NatWest bid could work.

"Further encouragement for this exciting proposal is provided by our good interim results, which show that our clear focus has produced further growth in assets, productivity and profits," chairman John Shaw said.

Legal & General talks

Bank of Scotland made its opportunistic bid for NatWest after the latter's £10.75bn bid for life assurer Legal & General was badly received by the markets.

Bank of Scotland Chief Executive Peter Burt has revealed that they too explored a tie-up with Legal & General several months ago. They had come to the conclusion that merging banks and insurers wouldn't work.

Mr Burt declined to comment on whether their bid for NatWest would be raised.

Bank of Scotland is now under pressure to raise its £20.8bn bid to see off rivals.

The bank reported annualised growth in lending since February was 22% with its UK market share rising to 6.9%.



Advanced options | Search tips




Back to top | BBC News Home | BBC Homepage | ©


The Company File Contents


Relevant Stories

24 Sep 99 | The Company File
Q&A: NatWest takeover bid

27 Sep 99 | The Company File
Royal Bank confirms NatWest interest

26 Sep 99 | The Company File
RBS to join fight for NatWest

03 Sep 99 | The Company File
Banks shop for life companies

03 Aug 99 | The Company File
Bank profits continue to rise

03 Aug 99 | The Company File
NatWest profits rise to £1.14bn





Internet Links


Royal Bank of Scotland

Bank of Scotland

NatWest


The BBC is not responsible for the content of external internet sites.




In this section

Microsoft trial mediator welcomed

Vodafone takeover battle heats up

Christmas turkey strike vote

NatWest bid timetable frozen

France faces EU action over electricity

Pace enters US cable heartland

Mannesmann fights back

Storehouse splits up Mothercare and Bhs

The rapid rise of Vodafone

The hidden shopping bills

Europe's top net stock

Safeway faces cash demand probe

Mitchell intervenes to help shipyard

New factory creates 500 jobs

Drugs company announces 300 jobs

BT speeds internet access

ICL creates 1,000 UK jobs

National Power splits in two

NTT to slash workforce

Scoot links up with Vivendi

New freedom for Post Office

Insolvent firms to get breathing space

Airtours profits jump 12%

Freeserve shares surge

LVMH buys UK auction house

Rover - a car firm's troubles