Scotland hit by latest RBS cull

You've got to credit RBS with impeccable timing over announcing its decision to cut another 2,600 jobs - immediately after bullish Q1 results and as the media's eyes are focused firmly on the shake-up in Westminster.

This time the bulk of cuts (2,000) are due to hit its insurance division - including Direct Line and Churchill - which means Glasgow is affected, along with operations in Bromley in Kent, Leeds and Bristol.

As many as 500 of the RBS insurance job cuts will be as a result of offshoring back office functions.

This appears to be an increasingly used cost-cutting device by RBS. Last year, concerns were raised that it would transfer back office functions to cheaper locations, and IT was also earmarked for a passage to India.

Scotland will also bear the brunt of the firm's decision to cut 600 jobs in its retail banking head office function, which is based out of both London and Edinburgh.

A spokesperson for RBS said that they'd attempt to keep compulsory redundancies to a minimum and that fewer than one in four of the 22,600 jobs cut so far have been lost in this manner.

"We are working hard to rebuild RBS in order to repay taxpayers for their support and having to cut jobs is the most difficult part of this process," she said.

Unite, the union that represents RBS employees, has already expressed its concern over the move.

"This is an eye-watering reduction of over 25% of the job roles within the retail head office function that currently employs around 2,100 staff," said Rob Macgregor, Unite's national officer for finance.

The EC settlement means that RBS is being forced to sell 318 branches, which means fewer people will be required in its retail banking head office.

The bidders for RBS's UK branches is now down to a two-horse race, according to reports in the Wall Street Journal.

Banco Santander and National Australia Bank (parent company of Clydesdale Bank) are most likely to be shortlisted after Virgin Money was eliminated from the process over the weekend.

This might not be great for jobs either - Santander may use its existing IT networks and back office functions to strip out costs.