Thursday 1 March 2018 4:07 pm

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

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.

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.

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.