RBS to axe jobs, sell off more assets
Monday, 2 November 2009 17:50Royal Bank of Scotland, which was rescued by the British government in the wake of the global financial crisis, plans to axe about 3,700 jobs across its retail operations in Britain.
The announcement comes as the British government prepared to set out tomorrow plans to break up Royal Bank of Scotland and another lender it rescued, Lloyds Banking Group.
RBS earlier said it would consider selling more assets than initially planned to win EU support for the state aid received by the group.
The embattled company, which is 70% owned by the UK taxpayer after a huge bail-out last year, added that it was close to an agreement over the terms of its participation in a government scheme to insure toxic or high-risk assets.
Media reports at the weekend suggested that RBS could be forced to sell its Churchill and Direct Line insurance divisions and part of its investment banking arm, to ease European Commission concerns about state aid.
Also over the weekend, British Chancellor Alistair Darling outlined plans to create three new high street banks from the bailed-out lenders RBS, Lloyds Banking Group and Northern Rock. He said the three existing lenders would be broken up and parts sold in the next few years to new entrants to the sector, who would concentrate on deposits and mortgages. Firm details of the planned break-ups are set to be announced tomorrow.
