# Are job losses in the banking sector inevitable?



## Shawady (25 Nov 2008)

With the talk that 6 Irish banks will eventually be merged to 2 or 3 strong banks is it inevitable that there will be a lot of job losses as this is what generally happens when companies merge?
I am just imagining a situation where several different banks each have a branch in a particular town/village. If they merge it would not be viable to have 2 branches in the one town.


----------



## CGorman (25 Nov 2008)

*Re: Are Are job losses in the banking sector inevitable?*

Yes of course there will be job losses; lots of them. Indeed with or without mergers, there will be losses as the banks cut every expense they can.

Indeed the 3,500 figure speculated by the Unions could understate the mark. If one were to estimate that there are 150 towns/locations with 4 branchs that might become two and that the average branch has 15 staff and that 33% of staff are transfered to buyers branch, then you're looking at 6,000 losses. 

Note that BOI has over 300 branches on the Island and AIB has something similiar. 

Even if there are no mergers, it is likely that the banks will layoff large numbers to reflect less business - less staff needed to process mortgage apps etc.... even a 10% cut in staff numbers would lead to thousends of layoffs.


----------



## PaddyBloggit (25 Nov 2008)

*Re: Are Are job losses in the banking sector inevitable?*

I'm surprised it hasn't happened years ago ..... I haven't been in a bank for months ... I do all my banking online/by phone/by letter.


----------



## Raskolnikov (26 Nov 2008)

*Re: Are Are job losses in the banking sector inevitable?*

Branch closures are an inevitability in my opinion. During the boom years, banks weren't too concerned about costs as they were making huge profits anyway. Also, the fact that most of our banks are Irish owned, management were probably less open to culling staff. 

The situation however is changing. If a private equity firm like the Carlyle Group take an equity stake in a bank, they will likely try to cut costs in order to stabilise the bank and maximise profits.


----------



## csirl (26 Nov 2008)

*Re: Are Are job losses in the banking sector inevitable?*

Yes


----------



## Mpsox (27 Nov 2008)

*Re: Are Are job losses in the banking sector inevitable?*

It;s started already, most of the banks have recruitment freezes in place so as staff leave naturally, they are not being replaced. Staff on fixed term contracts are not having them renewed and agency staff are being left go. Contacts in some of the banks are saying that internally, there are rumours of VR schemes coming up. Where staff are spare in eg mortgages, they are being reassigned to debt collection

Possbily the only issue that may restrict a banks ability for wholsesale redundancies is finding the money to do so. Traditionally, banks have paid 5-8 wks per year service in past schemes and the unions would be very reluctant to accept less. Likewise if banks are merged, their IT systems will need to be merged for any major branch or centre closures and that will take time and money


----------



## VOR (3 Dec 2008)

*Re: Are Are job losses in the banking sector inevitable?*

They have started to move lenders in to collections roles. That's the start of it. Your local, friendly bank official who was flogging you mortgages, credit cards and car loans 2 years ago will be knocking on doors within weeks.
IIB, Bank of Scotland and Permanent TSB have already moved mobile lenders in to collections as part of "projects".

Funds will be redeemed and that will mean job losses for the IFSC. Bloomberg have stated that up to 1 in 4 hedge funds will cease next year. Staff will have to be let go. PFPC have already let 10% go.


----------



## Teknon (3 Dec 2008)

*Re: Are Are job losses in the banking sector inevitable?*

Isn't great to see Mystic Meg and Co are alive and well gazing into their crystal balls !  Noboby knows what is going to happen, give it a rest with the doom and gloom speculation !


----------



## Lulu123 (3 Dec 2008)

*Re: Are Are job losses in the banking sector inevitable?*

Banks based in the IFSC are letting people go every day but these haven't made the news for some reason.  They may not all be Irish (most are American and having offices to run and paying people in euros is seriously hurting them)

I think the banking sector is going to be the worst affected after the construction industry.


----------



## Howitzer (3 Dec 2008)

*Re: Are Are job losses in the banking sector inevitable?*



Teknon said:


> Isn't great to see Mystic Meg and Co are alive and well gazing into their crystal balls ! Noboby knows what is going to happen, give it a rest with the doom and gloom speculation !


Much better to keep our collective heads in the sands and pronounce that "no-one could have seen it coming" if/when things go pear shaped. Well it's worked so far anyway.


----------



## Teknon (3 Dec 2008)

*Re: Are Are job losses in the banking sector inevitable?*

..........and stand on your soap box giving your tuppence worth !


----------



## shanegl (6 Dec 2008)

*Re: Are Are job losses in the banking sector inevitable?*



Lulu123 said:


> Banks based in the IFSC are letting people go every day but these haven't made the news for some reason.  They may not all be Irish (most are American and having offices to run and paying people in euros is seriously hurting them)
> 
> I think the banking sector is going to be the worst affected after the construction industry.



Some are making the news, but just not headlines for some strange reason. 

[broken link removed]

Citigroup is so big that its bound to make the headlines when the redundancies are announced.


----------



## z109 (6 Dec 2008)

*Re: Are Are job losses in the banking sector inevitable?*



Teknon said:


> ..........and stand on your soap box giving your tuppence worth !


Why do you bother reading discussion boards? Why do you bother posting in reply? In case you hadn't noticed, this is what discussion boards are for. Somebody asks a question, gives they answer they have (if they have one), and looks for other opinions. They might not like the opinions, but there you go - if you don't want them, don't ask for them. Equally, other people read the opinions provided and go away with a range of emotions - if you don't think people should give their opinions, you are looking in the wrong place. Perhaps you should stick to the television or newspapers?


----------



## z109 (6 Dec 2008)

Anyway, back on topic, I think the difficulty of merging of IT systems is overstated. There are already procedures in place allowing customers to move accounts and taking all their payments with them. So I don't see a long-run overlap in the IT department.

I can't see any way that a two insolvent banks merging would be in a position to do anything other than slash their dual locations - it is already planned to happen with the merger of Lloyds and HBOS in the UK.

On the other hand, some of the former building societies are still run as separate businesses (Ulster Bank and First Active, for example, are both owned by Bank of Ireland). So it may be that the 'functions' of the banks will be split with one half being run as a 'savings and loans' with the other half being run as a retail bank (depending on the combinations). But in the event of real insolvency-type trouble, I can't see that this would be a solution to create well-capitalised banks that could lend.


----------



## z109 (6 Dec 2008)

musha said:


> Eh no.. thats not true. Perhaps you knew this but made a typo. It happens. But anyway for the record Ulster bank and First Active are both owned by the Royal Bank of Scotland, certainly not by Bank of Ireland.


Sorry, yes, it was a typo - I was trying to think of the former building society that BoI own while at the same time typing RBS. Always a bad idea to try and think and type at the same time!


----------



## rmelly (6 Dec 2008)

AIB have already cut their IT contractors by a third and are embarking on another round of cuts soon.


----------



## p45 (8 Dec 2008)

It's going to happen alright, and what's so scary about it is that a generation of reasonably well to do bank employees are about to become the new poor.


----------



## Shawady (8 Dec 2008)

*Re: Are Are job losses in the banking sector inevitable?*



Teknon said:


> Isn't great to see Mystic Meg and Co are alive and well gazing into their crystal balls ! Noboby knows what is going to happen, give it a rest with the doom and gloom speculation !


 
I didn't pose the question as a prophet of doom. I'm surprised it hasn't been mentioned much in the media given the potential for a large number of job losses. I read in the paper that there are 40,000 people working in the banking sector so even if 25% were made redundant through mergers it would be a huge loss. Considering there were rumours that Dell could be in trouble and that seemed to get decent media exposure for what was approx 3,000 jobs.


----------



## wolfspeed (10 Dec 2008)

*Re: Are Are job losses in the banking sector inevitable?*



Shawady said:


> Considering there were rumours that Dell could be in trouble and that seemed to get decent media exposure for what was approx 3,000 jobs.


 
The thing with Dell is that while 3,000 direct jobs would go, there are huge numbers of jobs dependent on that 3,000. Also a lot of these FDI companies are symbolic of the celtic tiger years. That is why there is so much media exposure on the likes of Dell.


----------



## UK Mole (6 Jan 2009)

*Re: Are Are job losses in the banking sector inevitable?*



Teknon said:


> Isn't great to see Mystic Meg and Co are alive and well gazing into their crystal balls !  Noboby knows what is going to happen, give it a rest with the doom and gloom speculation !



It is not true that nobody knows what is going to happen. People are making plans while you scoff, Teknon. Real plans that will see redundancies. Watch out for a UK Bank with businesses in Ireland that needs to make big savings to refund the UK government. Would anyone miss the Workingman's Benefit Building Society? Time for the workers to stand up.


----------



## agapanthus (6 Jan 2009)

Do you know something we should know?   Hard to know what the workers can do at this point, those at the top have mucked it up for everyone.


----------



## UK Mole (6 Jan 2009)

You're right - the top (especially in this case) really have mucked up. As usual, the little people pay the price. And they are being condemned by their fellow workers who are advancing the plans (after signing the secrecy agreements). Maybe a bit of agitation and lobbying might not go amiss?


----------



## agapanthus (6 Jan 2009)

I'm intrigued now, secrecy agreements?  havent heard this one, not suprisingly if its a secret I suppose.  Would you like to elaborate


----------



## UK Mole (6 Jan 2009)

I really wouldn't. I don't fancy becoming part of the CEO's moleskin coat! A bit of googling will give you the organisation and I think I've outlined its fate (and the fate of the majority of its branches). Two weeks or so to the announcement. I'm off underground.


----------



## Mpsox (7 Jan 2009)

yoganmahew said:


> Anyway, back on topic, I think the difficulty of merging of IT systems is overstated. There are already procedures in place allowing customers to move accounts and taking all their payments with them. So I don't see a long-run overlap in the IT department.
> 
> I can't see any way that a two insolvent banks merging would be in a position to do anything other than slash their dual locations - it is already planned to happen with the merger of Lloyds and HBOS in the UK.
> 
> On the other hand, some of the former building societies are still run as separate businesses (Ulster Bank and First Active, for example, are both owned by Bank of Ireland). So it may be that the 'functions' of the banks will be split with one half being run as a 'savings and loans' with the other half being run as a retail bank (depending on the combinations). But in the event of real insolvency-type trouble, I can't see that this would be a solution to create well-capitalised banks that could lend.


 
I've been through an IT integration programme 3 times(twice in the UK, once in Ireland) in the financial services sector with a bank merging/moving from one platform to it's parent groups system. End to end, from planning and design stage to completion , on each occassion, it took approx 12 months. The actual move only took a weekend, but most banks have so many different systems in place it is complicated to do so and have no visible impact on customers


----------



## UK Mole (26 Jan 2009)

"The Ulster Bank Group has announced 750 redundancies in Ireland and the ending of the former building society First Active brand by the end of the year."

Someone must have leaked that early - it wasn't supposed to be announced till the end of the month!


----------



## agapanthus (26 Jan 2009)

oh dear! who would do that


----------



## wbbs (31 Jan 2009)

Well Mr. Mole you seem to have access to info us mere employees of FA dont so perhaps you could offer an opinion which might help me decide whether to take the money and run or attempt to move to UB.  

Do you think this move is a tidying up of the situation so that UB is in a better position to be got rid of totally down the road.   I am sure RBS dont care too much about Ireland at the moment and I personally think if they could have off loaded the lot they would have.   

Therefore would I be better getting out now and taking my chances in this non-existent job market or moving to UB and ending up in the same if not worse situation in a few years time?


----------

