RBS to cut 3,500 jobs after branch sell-off

Royal Bank of Scotland is axing a further 3,500 jobs in the UK, taking the number of cuts since it was bailed out and nationalised in 2008 to almost 27,000 worldwide.

RBS, which is 83 per cent owned by the UK taxpayer, said the cuts would affect administrative and IT staff based in 10 locations around the UK. About 500 jobs will be relocated to India, the US and the Far East.

More than 20,000 UK-based jobs have already been eliminated at RBS as its chief executive, Stephen Hester, tries to trim annual costs by £2.5bn and improve profitability. RBS employs about 160,000 staff globally.

The bank said about 1,500 of the latest batch of losses were related to its forced sale of 318 branches to Santander, which was ordered by European competition regulators.

Although branch staff were transferred to Santander as part of the £1.6bn deal last month, support staff were not included.

The bank said: "Having to cut jobs is the most difficult part of our work to rebuild RBS and repay taxpayers for their support. We continue to make efficiencies across our business and adjust our plans in line with the divestments we have been required to make by the European Union."

It said it would seek to re-employ staff wherever possible and keep compulsory redundancies to a minimum. The trade union Unite, however, called the cuts a "horror story" and "bitter pill" after RBS posted surprise half-year profits of £1.1bn last month.

The cuts will see RBS processing centres in Leeds and Bolton close next year, followed by sites in Bristol, Liverpool, Milton Keynes and others in 2012.

Lloyds TSB, which was also bailed out by the UK government following the financial crisis, has axed 18,000 jobs, most of them in the UK.

On Wednesday, Standard Life, the investments group, said it would cut 600 UK posts, and about 300 jobs are going at Barclays.