Ulster Bank cuts another 250 jobs

ULSTER Bank is to slash a further 250 jobs from its Irish operations, bringing to 1,000 the number of jobs being axed by the group over the next 12 months.

Earlier in the year the bank said it was looking for 750 voluntary redundancies linked to the closure of its First Active subsidiary.

That process is due to be completed by the year end, with the rest to follow after discussions with the banking union, IBOA. The latest job announcement came as Ulster Bank reported first half losses of £8m (€9.3m) compared with profits of £172m (€200m) in the first half of 2008.

Overall job numbers will be reduced to 5,000, leaving 3,000 jobs in place the Republic, with the rest linked to the bank’s Northern Ireland operations.

Chief executive Cormac McCarthy said further jobs losses are unlikely: “I believe we’re nearly there.”

The jobs cull will deliver 20% savings over two years, he said.

IBOA general secretary Larry Broderick described the job cuts as “profoundly disappointing”.

“The bank has given us an undertaking this morning that all job losses will be implemented on a voluntary basis and on the same terms as the programme for 750 redundancies which is already under way,” he said.

“This major development underlines the call I made earlier this week for a thorough review of the future of banking in Ireland where up to 5,000 jobs are under threat over the next two years,” he said.

The latest CSO figures also show a financial sector also under attack from falling wage packets. Pay for workers in the financial services sector, including irregular bonuses, fell by 11.1% in the first three months of this year compared with the same period in 2008. Hourly pay fell from €34.17 to €30.37.

The €8m losses announced by Ulster were significantly higher in reality in the six months, but a change in the bank’s structure masks that fact, Mr McCarthy said. When account is taken of the €15bn of loans shipped across to the non-core operation set up by the bank’s parent, RBS, the losses at Ulster Bank, were well above the numbers reported.

Total lending to customers was flat, with mortgage lending up 2%, but deposits fell 17% to £18.9 billion (€22.2bn). Interest income fell 8% to £410m.