ABN Amro to cut 5,000 jobs, 1-1.3 bn euros

ABN Amro to cut 5,000 jobs, 1-1.3 bn euros
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First Published: Tue, May 19 2009. 05 47 PM IST
Updated: Tue, May 19 2009. 05 47 PM IST
Amsterdam: Dutch state-controlled bank ABN Amro plans to cut a net 4,000 to 5,000 jobs and up to 1.3 billion euros in costs over the course of its integration with Fortis Bank Nederland, a spokesman said Tuesday.
The spokesman said some 5,500 to 6,500 would actually be cut, but the group would also create 1,500 new jobs as well.
It was not immediately clear what percentage of the new group the job cuts would represent. ABN Amro had 57,000 staff globally at the end of 2008, while Fortis Bank Nederland had just under 10,000 employees.
The cost cuts are expected to come in somewhere between 1 billion and 1.3 billion euros ($1.36-$1.77 billion).
The spokesman said that there was no fixed target date for the job or cost cuts to be completed, but rather that they would be expected over the course of the integration of the two banks. The scope of the cutbacks was first revealed in a series of statements from trade unions early on Tuesday.
The Dutch government bought struggling Fortis Bank Nederland last October, including its interests in ABN Amro. As of late December the state replaced Fortis as a shareholder of the entity that manages ABN Amro.
The government’s plan is ultimately to combine Fortis Bank Nederland and ABN Amro and then sell the newly unified bank to the public. It brought in former Dutch finance minister Gerrit Zalm in to run the new group.
Complicating those plans is the fate of a 709 million euro asset sale Fortis and Deutsche Bank agreed last year. The deal was ordered by the EC on competitive grounds after a Fortis-led group bought ABN in 2007.
But the Dutch central bank DNB put the money-losing sale on hold while the nationalization process took place.
ABN has since said it is not bound by the deal, which Deutsche Bank is eager to close. ($1=.7337 Euro)
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First Published: Tue, May 19 2009. 05 47 PM IST