The Financial Times (FT) is reporting the state owned Royal Bank of Scotland (RBS) could be on the verge of slashing 10,000 jobs from its investment banking division.
The suggestion comes following government pressure for the bank, which had to be rescued with £45bn of tax payers' money, to reduce its riskier activities.
The sense is that RBS has failed to become a major player in key investment banking activities with the FT highlighting its weakness in equities. RBS's Chief Executive, Stephen Hester, is said to be pondering closing the under-performing parts of the business. This option would see the most jobs cuts.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
A second possibility is a sale to another bank, although exactly who would be interested in a transaction is unclear.
RBS shares were down 1.5% in morning trading. Over the last year the stock has fallen nearly 50%. Since the beginning of 2007 RBS has fallen by 96%.
BS
-
8 of the best converted properties for sale nowThe best converted properties for sale – from an apartment in the former Hartley’s Jam factory on London’s Southbank, to a converted 18th-century mill in Itteringham, Norfolk
-
How taking a two-year career break could leave a £26k hole in your pensionCareer breaks are increasingly common but it is important to take steps to protect your pension, as gaps compound over time
