IT staff at the Royal Bank of Scotland are fearing for their jobs after it was revealed that the group is in the advanced stages of drawing up potential plans to nearly halve the size of its investment bank.
On a bleak day for banking, as it was revealed that RBS could slash up to 10,000 jobs, Societe Generale also announced it was cutting 1,580 investment bank jobs.
IT staff at banks have hoped that the 'ringfencing' - or operational separation - proposed by the recent Vickers report would reinvigorate the job market, but analysts have said this will not be noticeable until at least 2016 because of a long planning process.
The RBS job cut plans, reported in today’s Financial Times, are the worst case scenario being considered by the bank, which is 83 percent owned by the taxpayer.
RBS is considering exiting the cash equities, equity derivatives and advisory services for mergers and acquisitions. It has so far declined to comment.
RBS was heavily criticised in a report last month by the Financial Services Authority, which lambasted the aggressiveness of its £48 billion move to take over Dutch bank ABN Amro, and said it was continually operating without the right risk management systems and processes.
IT staff at RBS have been working hard on improving the bank’s systems in the wake of its near-collapse, and they have played a key role in its day-to-day functioning and strategic growth.
The job cuts would come at a time when RBS is spending £6 billion on specific IT and marketing projects, as it attempts to roll out standardised technology across its global operations. A number of projects are focused around SAP enterprise resource planning and SAP for Banking software, the standard core platforms it is implementing.