PTSB to cut 120 jobs and 11 branches

PERMANENT TSB is planning to cut around 120 jobs, early in the new year, and close 11 bank branches as a means of cutting further costs from the business.

The move will reduce the number of branches PTSB — the retail banking arm of Irish Life & Permanent (IL&P) — operates from 103 to 92. The job cuts will be part of a voluntary severance scheme which will offer staff 7.25 weeks’ salary per year of service, capped at 2.75 years. The offer is open to employees until February, at which time the bank hopes to implement the restructuring.

It is not yet known which branches will be affected by the move, but a spokesperson for the company said the closures wouldn’t be isolated to any one part of the country. Employees are to be notified in the coming days about which branches are under review.

However, much of the thinking behind the closures will be their proximity to other branches; the company adding that certain branches will be amalgamated with others in their local area and customers will be transferred seamlessly to their new branch with no interruption in service.

According to Permanent TSB chief executive David Guinane the company had no choice but to announce further cost-saving measures, given the current economic climate.

“We’ve already taken a number of measures to address our cost base such as the incentivised career breaks for staff and we have already implemented significant reductions in our overhead spend.

“However, it is clear that the short-term outlook for new business levels has not improved and this is the next step in getting the bank fit for the new business environment we face,” he added.

It is expected PTSB will form part of the so-called and much mooted ‘third force’ of Irish banking sometime towards the middle of next year — essentially joining as an add-on to the seemingly pending merger of the EBS Building Society and the Irish Nationwide Building Society (INBS), which is expected to be completed before the end of this month.

It is thought PTSB’s parent — a restructured IL&P — would end up controlling a 40% stake in the newly enlarged entity.

In a recent trading update, IL&P said provisions for impaired loans for the second half of this year would be greater than previously anticipated, but that impairment provisions at the PTSB division should be “broadly in line” with first-half levels.

IL&P’s share price was up by 12c, yesterday, at €3.30.