RBS to axe 3,000 jobs as Citi staff braced for more cuts

The jobs cull in the banking industry continued apace yesterday as Royal Bank Scotland prepared to cut 3,000 staff from its investment banking business, National Australia Group announced it is axing 350 at its UK banks Clydesdale and Yorkshire, and Citigroup staff braced themselves for another 10,000 redundancies worldwide.

RBS, which employs about 21,000 staff in investment banking in 50 locations across the globe, is in the late stages of identifying the cuts in its global banking and markets business An announcement on the headcount reduction is expected within weeks and is likely to amount to a few hundred in the UK. It is not expected to include staff at the group's high street RBS or NatWest branches.

The Edinburgh-based bank is reeling from the impact of the credit crisis, announcing this month that it faces the prospect of posting its first ever full-year loss. This came shortly after it secured a deal to raise £20bn, which will leave the UK government with a significant stake in RBS.

Yesterday, a spokeswoman for RBS said: "We are constantly reviewing our business model to ensure that we are aligned to market conditions and would take action accordingly." She declined to comment further on the cuts.

Citigroup is also expected to hand out notices to more UK employees in coming weeks amid reports that it is set to announce 10,000 cuts on top of the 23,000 it has already made this year. Goldman Sachs said last month that it planned to axe 10 per cent of its workforce worldwide, which followed talk of cuts by HSBC, Morgan Stanley and Merrill Lynch.

Meanwhile, National Australia Group said yesterday it would cut 350 jobs at its UK retail banks Clydesdale and Yorkshire next year. It hopes to reploy 272 of these to other divisions including AXA.

It has been a dire week for UK jobs as the impact of the credit crunch rumbles on. Culls in the media and telecoms space included BT announcing on Thursday it would cut 10,000 jobs by April. This followed Vodafone announcing a £1bn cost-cutting package which is likely to have an impact on jobs, on the same day that Virgin Media said 2,200 employees would lose their jobs. GlaxoSmithKline and Yell also announced plans to reduce their headcount this week.