One in 10 bank staff could lose jobs, union claims
Issued : 8 July 2009
Irish Examiner
ONE in 10 bank workers could lose their job as financial institutions battle to overcome billions of euro in losses.
The Irish Bank Officials' Association (IBOA) estimates 5,000 jobs could be lost as financial institutions cut costs to avoid further Government intervention.
General secretary of the IBOA union, Larry Broderick, said the massive job losses could result from a combination of "opportunistic cost-cutting" by senior management and consolidation within the banking sector.
The IBOA has urged the Government, which it said has "considerable financial as well as moral influence over the banking industry" to ensure that banks operate in the longer-term public interest rather than continuing with the "short-sighted policies which has created the financial crisis".
Mr Broderick said there is a real danger that major financial institutions will adopt short-term responses at the expense of staff and customers because of their anxiety to pay off the State's investment as quickly as possible in order to avoid further Government intervention.
A spokeswoman for Bank of Ireland said that while the bank is not planning any job cuts at present, it cannot rule anything in or out. "Cost reduction is a major part of the business," she said.
AIB said its policy is to be as efficient as possible while maintaining employment.
Staff at Ulster Bank recently proclaimed fear that more jobs are at risk - on top of the 750 jobs already targeted by the company - after the bank's parent RBS announced it is seeking an extra 9,000 job cuts worldwide.
The Irish Banking Federation refused to comment on the issue of job cuts in the sector.
Davy analyst, Emer Lang said the scale of cost-cutting measures at the Irish banks will depend a lot on how the National Asset Management Agency (NAMA) affects the different institutions.
Davy refuses to estimate how many jobs cuts are likely in the banking sector in Ireland but it is not ruling out the prospect that the banks will have to shed jobs, saying the banks have not gone far enough with their cost-cutting measures. Ms Lang said one option open to banks would be pay cuts rather than job cuts. She said banks, historically, have not implemented compulsory redundancies but they would likely weigh up the costs associated with voluntary redundancies before making any decisions on cost cutting.
Yesterday, six Irish banks and building societies backed by government guarantees had the ratings on some of their securities lowered at Moody's Investors Service. Moody's said: "While we do not question the government's unchanged strong willingness to support these large banking institutions, we do, however, note that the ability of the Government to continue to support its banking sector has weakened over the past few quarters."
The International Monetary Fund recently said that Ireland's banks face losses of as much as €35 billion through next year.
Niamh Hennessy and Stephen Rogers
This story appeared in the printed version of the r Wednesday, July 08, 2009
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