Bank shrugs off jobs loss reports

NATIONAL Australia Bank has dismissed weekend stories about 400 jobs being lost in the Irish divisions as a bid by potential buyers to talk down the price.

A spokesman in London for NAB also rejected claims that up to 40 branches, mainly in the North, would be closed if the banks are not sold to a third party in the near future.

NAB's spokesman said the speculation was unsubstantiated and warned NAB will not capitulate over price in the case of its two Irish subsidiaries, Northern Bank and National Irish Bank.

"This is not a fire sale and we see value in these businesses," he said.

He went on to say that NAB chief executive John Stuart stressed the Irish banks would not be sold if the price was not right.

Because NIB has proved such a disaster for its Australian parent, the markets believe the Australian parent is vulnerable on the sale issue.

The investigation into NIB's internal affairs and its systematic defrauding of customers and its bogus non-resident account scams, made national headlines and wounded the bank's brand in the Republic especially.

Halifax Bank of Scotland and others were expected to tender offers for the two banks recently, but none were made before the deadline.

HBOS is still the main contender to buy the businesses, but at what price seems to be the only issue. Prices ranging between €1.2 billion and €2.4bn have been speculated on in the media.

The NAB spokesman said he was not going to comment on the bid speculation other than to restate Mr Stuart's view that both banks have real value that can be developed.

If the price isn't right, that is the course NAB will pursue, said the spokesman.

Mr Stuart has been assured by Irish executives that, in their view, NIB has potential.

Despite its name being dragged embarrassingly through the courts and the searing indictment of 15 of its top executives over their mismanagement of the bank and their association with fraudulent behaviour, the bank still has value. NAB's spokesman said despite the attempts to push the price down, neither NIB nor Northern Bank will be sold as a last-ditch measure.

He rejected suggestions also that the group's informational technology back-up was seriously out of date and would cost anything up to €100m to upgrade.

Much of the speculation of the last few days has been deliberately fed to certain parts of the media in an attempt to "undermine the value of the two Irish banks," added the spokesman.