More job cuts "inevitable" says Royal Bank of Scotland finance boss

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RBS Become Latest bank To Ask For Financial Assistance
Royal Bank of Scotland announced it would close hundreds of branches last year (Source: Getty)

It is "inevitable" that Royal Bank of Scotland (RBS) will cut jobs in the coming years, according to the lender's chief financial officer.

Ewen Stevenson today said the the cuts would focus on slimming down head office functions, as well as legacy data centres, but refused to address the size of the redundancies expected.

Speaking in an interview with Bloomberg Television, Stevenson said the bank's leadership is "very comfortable with the shape of the branch network", and said it would give six months' notice before closing further branches.

Read more: RBS still employs 94 per cent of GRG management in "new" restructuring arm

In December the bank, which is still almost 80 per cent owned by the government, said it will close one in every four branches, as it tries to cut costs and adjust to consumers who increasingly bank remotely over the internet.

In its annual report, published last week, the bank said the remaining branches "will remain key outlets" focused on major financial advice around major decisions like mortgages and starting a business, rather than the "routine transactional banking".

RBS last week announced its first annual profit in 10 years, although it still has the prospect of a massive fine in the billions of dollars from the US Department of Justice (DoJ) hanging over its head.

Read more: RBS’s return to profit welcome but will taxpayers ever see their £45bn?

Stevenson said the fine remains the major impediment to the bank paying a dividend, but added RBS's capital ratio reflects an ability to deal with a larger hit than the £3.1bn currently provided for by the bank. The fine relates to the misselling of retail mortgage-backed securities (RMBS).

Stevenson said: "We’ve got no update on timing. We’d like to get it settled.

"We need to get RMBS resolved with the DoJ. Once that’s resolved we can very quickly get back into a discussion on dividends."

He added the bank is undertaking "sensible contingency plans" with regard to Brexit, although said the issue of the border between Northern Ireland and the Republic of Ireland remains "important" to the bank. It owns Ulster Bank, which has significant operations on both sides of the border.

Read more: RBS mulls 259 branch closures as it chops 680 jobs in run-up to Christmas

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