RBS swings the axe on 2,000 investment banking jobs

13th Jun 2013 09:45

Royal Bank of Scotland is expected to announce another 2,000 job cuts in its investment banking division today.The job losses are due to filter through over the coming 18 months and be made across the division's worldwide offices, including the UK. The investment arm will shrink from a work force of around 11,000 to close to 9,000 after the cuts as it refocuses on a smaller product set.The investment unit is exiting retail structured products, equity derivatives and "peripheral market-making activities" in order to focus on its RBS Markets division and on fixed income products such as credit trading.The 81%-state-owned group, which is searching for a new Chief Executive after current incumbent Stephen Hester was compelled to resign late on Wednesday, is thought to planning privatisation by the end of 2014. With Chairman Sir Philip Hampton having confirmed "Treasury involvement" in the decision to remove Hester, broker Investec maintained the manner of Hester's departure was "deeply unsatisfactory". Analyst Ian Gordon said: "With the Parliamentary Commission on Banking due to report imminently, and with the Chancellor expected to comment on the 'privatisation process' at the Mansion House on June 19th the timing is curious indeed."On the process to appoint Hester's replacement, he added: "Officially, no front-runner to succeed him has been identified. If true we believe it is negligent. If untrue, then it may constitute Market Abuse."Shares in Royal Bank of Scotland were down 5.5% at 307.6p at 10:15 on Thursday.OH