Dutch banking group ABN Amro is teaming with Rabobank Nederland to establish a 50:50 joint venture firm that will manage both banks' cash processing operations.
Under the deal around 225 staff currently working at ABN Amro's cash processing operations will transfer to the new venture, which will be called Gavea. There will be no job losses from the venture as Rabobank currently does not directly employ cash processing staff.
The banks say they decided to set up the JV after the Dutch Central Bank said it was phasing out its cash processing operations from 1 January 2008. As a result inidividual banks in the country will be responsible for their own cash processing.
ABN Amro says the new venture will help keep the long-term costs of cash processing for both banks "under control".
Commenting on the move, Ron Teerlink, member of the managing board of ABN Amro, says: "This enables both banks to benefit optimally from the economies of scale resulting from joint cash processing. It also gives us a chance to control upward pressure on costs."