Nationalised Dutch bank ABN Amro is shedding 2,350 jobs - some 9 percent of its workforce - as the state readies it for a return to private hands. The bank said it expected 1,500 redundancies and 850 positions to be lost through natural attrition in the next three to four years.
Most of the job cuts will be in back-office operations such as IT, but some retail and private banking positions will also be axed. The bank said it has taken a restructuring provision of 200 million euros pre-tax for the redundancies. Global banks have announced close to 50,000 job cuts in recent months in the face of sluggish economic growth, volatile markets and regulatory changes.
The Dutch state, which nationalised ABN Amro during the 2008 financial crisis, plans to sell ABN Amro in 2014 or later, preferably by listing it on the stock market, so improving efficiency would make the bank more attractive to potential buyers. Historically, ABN Amro has had a relatively high cost-to-income ratio compared with other banks. The bank said its underlying cost-income ratio fell to 63 percent at the end of June, from 75 percent a year ago, and that the job cuts would bring it below 60 percent.
"If you look at the period 1995 to 2007, in that 12-year period the lowest realised cost-income ratio was 67 percent. So we have a historical record," ABN Amro Chief Executive Gerrit Zalm told reporters. The main reason for the cuts was a desire to be more efficient said Zalm - a former Dutch finance minister who earned a reputation as a fiscal hawk - and was not a reflection of the deteriorating economic outlook in Europe. Dutch rival ING has reported an underlying cost-income ratio of 59.2 percent, while Rabobank has an efficiency ratio of 59.7 percent.
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