Dutch banking group ABN Amro is axing 2850 jobs, including 1200 IT roles at its Netherlands and US operations, under restructuring plans that are expected to generate savings of EUR770 million by 2007.
Under the restructuring, 1200 out of a total of 5000 jobs will be lost at the bank's Group Shared Services (GSS) unit - which provides back office functions and was established to create cost savings through consolidation and standardisation. - as well as 550 jobs at its human resources department and 1100 roles at its wholesale clients unit, although the bank is creating 250 client-facing roles in the division.
The 1200 IT roles will be lost over the next 18 months as the bank adopts alternative delivery and sourcing scenarios, including in-house consolidation, partial outsourcing, multi-vendor strategies and/or offshoring. The bank says that further jobs could be transferred "depending on the extent to which we choose outsourcing as a solution for certain activities".
In total the bank will take a charge of 790 million euros ($1.1 billion) this year as a result of the job cuts but it expects to save EUR770 million euros a year starting 2007 following the restructuring.
The cost of changes to GSS will total EUR870m, of which EUR515m will be covered by the one-off charge. The remaining costs of EUR355m will run through the profit and loss accounts in 2005-2007. The expected cost savings related to the bank's wholesale banking are expected to be EUR170 million per year as of 2007.
The move follows Deutsche Bank's announcement earlier this month that it was cutting 1920 mainly back office jobs at its operations in Germany.