Merger costs 500 jobs at Lloyds TSB

Up to 500 staff at one of Lloyds TSB's administration offices are to lose their jobs in the wake of the group's merger of back-office functions, the bank announced yesterday.

The redundancies, at TSB's offices in Birmingham will be phased in by the end of 1997 as the company moves its operations to Bristol, where Lloyds already has an administration centre.

Although a total of 900 administration jobs out of the combined group's 2,400 staff will be lost in the move, 400 employees will be re-deployed elsewhere in Birmingham, making the rest redundant.

Peter Ellwood, deputy chief executive of Lloyds TSB, said: "In order to achieve the benefits from a merger, some very hard decisions have to be taken and the location of our main administration centre was clearly going to be one of them.

"Nobody can doubt the logic of reducing the number of administration sites and we recognised that we would have to make a choice between [Bristol] and [Birmingham] at some stage in the process."

The bank said yesterday that it would aim to ensure that none of the redundancies were compulsory. A register of volunteers for redundancy was being opened and the bank hoped to redeploy many staff in Birmingham.

The announcement was attacked by the banking union Bifu, which claimed the redundancies were only the first of what it claimed were likely to be 10,000 job losses as a result of the merger.

John Townsend, Bifu's assistant secretary at TSB, where the redundancies are centred, said: "This is just the start. No jobs are safe in Bristol or Birmingham and we are concerned that there will be many more to follow around the country."

The bank's warning of mass job cuts among Lloyds TSB's 87,000 staff follows a wave of redundancies within the entire banking sector. Up to 60,000 jobs have been lost in the financial industry in the past five years. Bifu claims up to 500,000 more may go in the next few years.

The claim of 10,000 redundancies at Lloyds TSB was denied yesterday by a spokeswoman, who said that with 6,000 staff turnover each year, the bank could absorb that scale of necessary departures.