“RBS has been a bruising place to work … and that doesn’t sit well with me,” said the Royal Bank of Scotland CEO McEwan on 26 February. “We will work hard to make [RBS] a much better place for our people.”
He mentioned on a conference call last week that “there will be substantial job losses,” and that “we haven’t got a number out there because we’ve got a lot of consultation to do with our people.”
Little did we, or his staff know, that this meant around 74% of people working in the investment banking part of the bank would be out of a job.
According to a report in the Financial Times, RBS will cut around 14,000 investment bank jobs in the US and Asia by 2019. This around 74% of the total investment bank workforce, which currently stands at 18,000. However, its hires 118,000 people worldwide across all units.
The FT report, which cited two unnamed sources, added that it plans to automate its back office services. This would make a majority of back office staff redundant.
RBS’ representatives were not immediately outside office hours for comment.
On 26 February, RBS booked a £3.5 billion loss in 2014 but said it paid £421 million in bonuses that year. While the bonus pool is 21% smaller than 2013 and McEwan rejected a £1 million bonus, RBS is dogged by a litany of litigation issues.
Meanwhile, in a bid to restructure the bank, the costs of doing so amounted to £1.3 billion. It also plans to cut its corporate operations down to around 13 countries, from 38.