Royal Bank of Scotland has cut more than 130 jobs in its investment banking division during the coronavirus crisis, with many staff served their redundancy notices via video call, according to people familiar with the situation.
The state-backed lender has pushed ahead with a restructuring of NatWest Markets — announced in February before the pandemic gathered pace in the UK — despite rivals delaying similar projects.
Trade unions criticised the move, which comes at a time when the hiring market has all but ground to a halt, and most staff are working from home with the UK under lockdown.
Rob MacGregor, national officer at Unite the Union, which represents RBS staff but is not recognised by NatWest Markets, said: “Our position is quite clear — all these restructures should be paused . . . because we don’t know what the lay of the land will be post crisis.”
RBS told trade unions it would pause cost-cutting efforts in much of its business, but has pushed ahead with changes in its NatWest Markets investment bank. Under new chief executive Alison Rose, the group in February announced plans to drastically shrink its investment banking division and move some of the remaining jobs in areas such as risk management to cheaper offices outside the UK. At the time, RBS didn’t quantify the scale of job cuts required.
“For a bank that’s still majority-owned by the British taxpayer, and one that owes the taxpayer more than any other corporate entity in our history, this is not a smart move by the leadership team,” said Mr MacGregor.
A spokesperson for NatWest Markets said: “In line with the strategy we announced in February, NatWest Markets is being refocused into a smaller, simpler business focused on the needs of the group’s core corporate and institutional customers. Following consultation with employee representatives for NatWest Markets, we are progressing this strategy and providing clarity to those colleagues in roles that do not form part of the business going forward.”
RBS’ decision to continue with the job cuts contrasts with many of its domestic and international peers.
HSBC, which announced a major restructuring four days after RBS did, told staff it would delay the “vast majority” of its planned redundancies due to the “extraordinary impact of the crisis”, while retail-focused rivals Virgin Money and Lloyds Bank have both paused plans to cut jobs and close branches.
In the US, Citigroup, Wells Fargo and Morgan Stanley have all suspended job cuts, as has Germany’s Deutsche Bank, which is also amid a restructuring.
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“We were expecting the same thing to happen in RBS, but it didn’t,” one RBS staff member who had been laid off told the Financial Times. “And obviously with this market it’s pretty much impossible to find something else.”
Recruitment has frozen across the City of London since the coronavirus outbreak, according to headhunters. Last week Hays, the FTSE 250 recruiter, raised £200m from investors to insulate it against an expected crash in fees.