Anglo Irish Bank Announces Redundancy Programme

Anglo Irish Bank has today, 4^th November 2009, announced that the first phase of its Redundancy Programme is seeking up to 230 departures from the Bank. This will bring its total workforce to around 1300 people representing a reduction of approximately 470 people from Anglo’s September 2008 baseline of nearly 1800 staff members. The sale of the Bank’s Vienna based operation, natural attrition and the transfer of staff to the NAMA unit represent about half of the reduction, while the Redundancy Programme will account for the remainder.

The redundancies are a result of the planned reduction in the size of the Bank due to necessary restructuring and the transfer of circa €28 billion of loans to NAMA in the coming months. The Redundancy Programme involves a reduction of about 110 jobs in its Irish operations, approx 95 people in the UK and approx 25 in the USA and Europe. 

Staff members were informed of the terms and conditions of the programme in briefings today. The Programme will commence on 9^th November in Ireland, the UK and the US and will conclude in February 2010. The terms and conditions were approved by the Board of the Bank following detailed discussions with the Department of Finance. The Bank has put in place a range of initiatives designed to inform and support staff as they consider their options. These include divisional and team briefings, a dedicated intranet site and helpline, individual meetings and external advice for employees who choose to opt for redundancy.

The Bank’s preference is to realise the targeted reductions through voluntary means in Ireland and the UK. The redundancy terms are as follows:

• In Ireland, 4 weeks pay per year of service, plus statutory entitlement, to a maximum of 52 weeks pay.
• In the UK, 4 weeks pay per year of service inclusive of statutory entitlement, to a maximum of 52 weeks pay.
• In the US, 2 weeks pay per year of service to a maximum of 52 weeks pay.

Commenting on the announcement, Mike Aynsley, Chief Executive of Anglo Irish Bank said:

“This Bank will undergo radical change in the coming months and today’s announcement is the first phase of a programme intended to reduce the cost base of the operation and improve efficiency. Regrettably, we have to let people go as we reduce the size of the balance sheet and re-structure the Bank. This reality is tough on our staff who have worked exceptionally hard and have shown huge commitment over the years, most particularly over the recent, difficult months. We will ensure that people are well informed, supported and are treated with dignity and respect.  Our mandate, as a nationalised Bank, is to keep the public interest to the fore and the restructuring of New Anglo Bank will reflect this objective.”

This first phase of the programme is to address surplus capacity in the Bank and subsequent work will focus on centralisation and automation initiatives that flow from the Restructuring Plan to be submitted to the EU at end November. While the Redundancy Programme will aim at a staged reduction of headcount during the course of 2010, subsequent reductions will be framed against a detailed review of structures, processes and IT systems build likely to occur over the course of 2010 and 2011. It is likely that the second phase of reductions will be similar in scale to the first, however where outsourcing is the objective the Bank will ensure as many people as possible are transitioned to the outsourcing entity.

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