RBS chairman: ‘Closures and job cuts on the way’

Shareholders were told to expect more job cuts and branch closures. Picture: TSPL
Shareholders were told to expect more job cuts and branch closures. Picture: TSPL
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SIR Philip Hampton, chairman of the Royal Bank of Scotland, signalled further job cuts and branch closures as he addressed shareholders at its annual meeting in Edinburgh yesterday.

Sir Philip said the bank, which has announced 37,000 job cuts since its taxpayer bailout in 2008, was on course to “substantially complete” its restructuring by the end of 2014.

He said: “So we’ve got to have our branches where our customers are, not necessarily be where we have had them for decades.”

Getting the business into the “right shape … could mean further impacts on employees”.

Chief executive Stephen Hester said RBS needed to “go from bust bank to normal bank” and the five-year plan he launched in 2009 “involved probably the largest and most complex company restructuring ever seen”.

The bank was well funded and it now had an “excess” of customer deposits, mainly because it struggled to find “sensible lending opportunities”.

Neverthless, he estimated it would take 18 months to improve the capital position enough to please regulators.

With a number of shareholders criticising the board for poor customer service, Sir Philip admitted that the “main disappointments” for RBS last year were the £2.2 billion in “conduct costs” the bank faced due to scandals related to mis-selling and illegal rigging of the interbank lending rate, Libor.

Sir Philip told shareholders that the bank, which is 81 per cent state-owned, would be returned to the private sector “as soon as we can”.

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