The Anglo-Irish Nationwide merger will be bad, but not brutal, for jobs

This has been coming, but the government has now taken the first legal steps towards merging Anglo Irish and Irish Nationwide, with a view to eventual closure. Clearly, this is not good news for jobs.

The High Court has just approved the government's plans to auction off the deposits of the Anglo and Irish Nationwide, in a bid to reassure retail customers before the long-term wind-down of the banks.

This means that the loan books - around €37bn at Anglo and around €2.5bn at Irish Nationwide - will be wound down over a number of years.

The two organisations have a combined headcount of around 1,400, which is expected to be reduced to around 1,000 within a year of the merger. This is bad, but there are reasons to believe that redundancies are unlikely to be brutal in the near future.

The initial impact is likely to hit back office staff - IT and support services - due to duplication after the merger, according to reports.

While staff in lending functions also seem like an obvious target, a large proportion have already been transferred across to loan workout positions. Arguably, because of the need to run the loan books down, there's years of work still to be had in these teams.

What's more, according to recruiters, the larger domestic institutions are still hiring workout specialists. This means that those looking for pastures new within Anglo or Irish Nationwide will have "no shortage of options", according to one Irish financial services headhunter.

The Department of Finance says that: "The restructuring of the banking system will have implications for the employees of the affected institutions. However, such matters will have to be addressed by the institutions themselves in the first instance."

It adds that the position of the employees will be "safeguarded as appropriate in accordance with the application employment legislation".