Allied Irish Banks to shed 2,500 jobs

Image caption, Allied Irish Banks is to cut its workforce by 2,500

Allied Irish Banks, the parent company of First Trust in Northern Ireland, has confirmed that it is cutting its workforce by 2,500.

The bank, which is now largely owned by the Irish taxpayer, has begun a consultation process with unions on the terms of a severance programme.

The 2,500 jobs will be cut across the bank's operations in the Republic, Northern Ireland and Britain.

It equates to a 19% reduction in the group's overall employment number.

If that were replicated in First Trust it would mean 260 job losses out of a staff of 1300.

AIB needs to save 170m euros this year and wants at least half the job losses to take place during 2012.

Ireland's deputy prime minister Eamonn Gilmore described the news as "very upsetting".

Speaking in the Irish parliament on Thursday, he said the government's priority and focus was on what could be done to create new jobs and investment in the banking and financial sector.

IBOA, the Finance Union, which represents almost 22,000 people across the UK and Ireland, said the proposed cuts would have a "devastating impact" on First Trust Bank's employees and their families.

"The scale of the proposed job losses means that ordinary bank staff are being asked to suffer the consequences of the mismanagement of the bank's affairs to a disproportionate extent," said IBOA general secretary Larry Broderick.

"IBOA has argued that First Trust Bank has a very important role in the economy of Northern Ireland and that everything must be done to maintain the integrity of the branch network, to keep in place the support functions in Belfast and also to ensure that the customers in Northern Ireland and Great Britain have continued service from AIB Group."

The union expects to enter formal negotiations with the bank's senior management next week.