Page last updated at 12:16 GMT, Tuesday, 19 May 2009 13:16 UK

Lloyds bank to axe 625 positions

Lloyds TSB branch
Lloyds sustained heavy losses after acquiring troubled lender HBOS

Lloyds Banking Group has announced it is cutting 625 jobs in the UK.

The job losses are due to the bank merging its corporate and small-business lending units together.

Lloyds said the job losses will be evenly split between Scotland and England & Wales. The UK Treasury owns 43% of Lloyds.

The move comes days after its chairman Sir Victor Blank said he would step down, following criticism of losses stemming from the decision to buy HBOS.

HBOS losses

Lloyds said it would be creating 300 new positions inside its new wholesale banking department, and some of those made redundant will be "considered" for the new roles.

The bank is embarking on a strategy of 'death by a thousands cuts'
Rob McGregor, Unite

Lloyds agreed to buy HBOS in September, and later reported that it made almost £11bn in losses from its acquisition.

The government subsequently agreed to insure £260bn of the bank's toxic loans, and to potentially raise its stake in the bank to 65% following the losses.

Lloyds last month announced it is to cut 985 jobs over the next two years at its business offering car finance.

"This latest decision to announce 625 job losses appears to suggest that the bank is embarking on a strategy of 'death by a thousands cuts'," said Rob MacGregor, an officer for the Unite union.

"The union will not accept a situation where the Lloyds makes weekly announcements of hundreds of job losses," Mr MacGregor added.

"Staff must be told the company's plans for the future of the organisation and not be left with the uncertainty that they could be the next to lose their jobs."

Lloyds said its wholesale arm has about 800,000 commercial and corporate customers.

Shares in the bank have dropped by 27% this year, prior to Sir Victor's announcement he would step down, as investors worried about how soon the bank would return to profitability.

Lloyds is expected to make further losses this year.



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