First Active job cuts were always on the cards

It might be scant consolation for the 750 people facing redundancy at First Active building society, but with parent company RBS slashing costs where it can, it was always likely to fall by the way-side. This hasn't stopped unions attacking the decision, though.

RBS has both the Ulster Bank and First Active brands in Ireland, having bought the latter five years ago. The decision to wind-down First Active will result in 750 job losses, with 45 of the 60 Irish branches being closed and the remainder absorbed into Ulster Bank.

Scott Rankin, an analyst at Davy Stockbrokers, says he's not surprised at the move: "Going back to when the deal was done, we were surprised that RBS kept the smaller First Active brand given the costs associated with running two operations in what is a very small market."

RBS is looking to shed 10,000 staff globally, and new CEO Stephen Hester is stripping away various parts of the business in order to cut costs.

Eamonn Hughes, an analyst at Goodbody Stockbrokers, says that First Active has traditionally punched above its weight in the Irish mortgage market.

"While it's never an easy process to implement, Ulster is making the correct strategic decision as many banks internationally take tough decisions to resize their business platforms given the adverse changing macro economic environment," he says.

But Larry Broderick said the move was a result of "incompetence and greed of senior management in RBS".

"Our members feel very strongly that Ulster Bank Group staff are effectively being scapegoated for the mismanagement," he said.

Meanwhile, Fine Gael spokesman Leo Varadkar, reckons these cuts are an ominous sign of things to come.

"These redundancies are likely to be followed by thousands more in the financial sector," he said.