Bloomberg News

U.K. Banks Cut 103,000 Jobs Since 2008, More Reductions to Come

June 03, 2011

June 3 (Bloomberg) -- The U.K.’s five-largest banks including Royal Bank of Scotland Group Plc and Lloyds Banking Group Plc have eliminated more than 103,000 jobs since 2008, with more to come.

That’s about 11 percent of their combined global workforces from the end of 2008 through 2010, according to Bloomberg calculations based on company filings. At least 34,500 of the cuts were made in Britain.

Banks have “aggressive” plans to control costs, “which would suggest that some further headcount reduction is required,” said Andrew Gray, banking leader at PricewaterhouseCoopers LLP in London. “In many cases cost savings will need to be made on their global businesses and will be spread across their international cost base.”

British banks have cut jobs and sold assets, trimming their balance sheets by 1.5 trillion pounds ($2.5 trillion) since the 2008 banking crisis as lenders reduce leverage and meet tougher capital requirements from regulators. Financial companies plan to cut 16,000 more jobs in the first half of 2011, according to the Confederation of British Industry, a lobbying group.

The biggest reductions have been at government-assisted RBS and Lloyds. RBS, which is 83 percent owned by the government, has cut 74,000 jobs in continued and discontinued units, with most of the decline resulting from asset sales. Lloyds, 41 percent government owned, has eliminated about 18,100 jobs including asset sales in the period following its acquisition of HBOS Plc, the U.K.’s biggest mortgage lender. As part of the integration, the bank last month said it had saved 1.6 billion pounds a year in costs at the end of the first quarter and plans to increase savings to 2 billion pounds by the end of the year.

Barclays, HSBC

“If each day massive groups of staff in processing centers, bank branches and call centers across the country are informed that their futures are uncertain, this is detrimental for the U.K.’s chances of economic recovery,” David Fleming, a Unite trade union’s national officer, said in a statement.

Barclays Plc’s reduced employee numbers by 5,300 since 2008. HSBC Holdings Plc’s headcount declined by 17,000, including about 6,000 in the U.S. after the bank closed its consumer-finance subprime unit to new customers. Europe’s biggest bank may eliminate jobs and close offices as part of its plans to make as much as $3.5 billion of cost savings by 2013, HSBC said last month. It’s reinvesting the savings in emerging markets, the bank said.

Standard Chartered Plc, which employs 97 percent of its workforce outside the U.K., added more than 11,400 people since 2008. Like HSBC, the bank has increased assets in the period, though it is the only bank to have expanded staff, according to data compiled by Bloomberg.

Spokesmen for the banks declined to comment on the job losses.

“The underlying trend is trying to make the back-office business more efficient, lower and lower, and create the room for client-facing staff so you can actually take market share,” said Mike Trippitt, an analyst at Oriel Securities Ltd. in London.

--Editors: Steve Bailey, Francis Harris.

To contact the reporter on this story: Jon Menon in London at

To contact the editor responsible for this story: Edward Evans at

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