16 branches and 250 staff to go at PTSB

Permanent TSB is to cut its staff by 250 and close 16 of its 92 branches.

A further two branches will become self-service locations.

According to restructuring plans released yesterday, the bank will be split into three units.

Jeremy Masding, who took over as chief executive of Permanent TSB in February, has been in negotiations with the Department of Finance and the troika about restructuring the beleaguered institution.

The aim is to have a “new, profitable bank by 2016 and secure the future of the bank as an efficient, competitive, and customer-focused bank,” he said.

Mr Masding will implement the restructuring plan “as a matter of urgency”.

It is proposed the PTSB is split into three units:

* There will be Permanent TSB, which will hold the bank’s good assets and will be used for all future business;

* There will be an asset management unit that will be used to work through the bank’s bad assets — mainly its tracker mortgage book;

* There will be a unit for the UK mortgage book.

Accompanying these moves will be plans to reduce staff numbers by 250 through a voluntary redundancy scheme, which will offer three weeks’ pay for each year of service.

Along with the closure of 16 branches and making a further two self-service branches, the bank will create a flagship branch in the centre of Dublin. There would be investment in its core banking functions.

Overall, the aim is to cut operating costs by 10%.

Mr Masding told the Oireachtas Finance Committee last week that unless PTSB was successful in its efforts to hive off its loss-making tracker mortgage book to some sort of bad bank then it would not have a viable future.

“Our objective is to carve out a viable, efficient, competitive, and customer-focused Permanent TSB bank from within the current group,” he said. “We believe that such a bank can make a positive contribution to the Irish banking landscape and is the best way of protecting the taxpayer’s investment in our business.

“We face significant challenges. However, we are very confident about our future prospects once this restructuring plan has been implemented.”

The Unite trade union said it will meet in the next couple of weeks to discuss the planned redundancies at PTSB.