NAB to axe up to 3000 jobs in big restructure

SYDNEY - National Australia Bank is preparing to slash an estimated 2000 to 3000 mainly back-office jobs as it continues to revamp the company.

Australia's biggest bank, the owner of the Bank of New Zealand, will unveil details of the job cuts on Wednesday when it issues what is expected to be a $A2.5 billion ($2.65 billion) half-year net profit.

A spokesman for BNZ, Owen Gill, said that bank had no programme for lay-offs in New Zealand. But the BNZ was "always under review ... We're always trying to find ways to run it better".

In Australia, market analysts say NAB's underlying result is actually expected to be disappointing compared with the strong growth reported by the other major banks.

NAB is still recovering from a shocking year last year that included losing A$360 million in the unauthorised foreign exchange options trading scandal and the subsequent loss of many of its top executives.

The bank is now undergoing a major restructure to better position itself for growth by integrating its corporate and retail banks and its wealth management business.

ABN Amro analyst Jonathan Reoch said about 2000 to 3000 jobs were expected to be cut.

That would represent about 10 per cent of NAB's Australian workforce, which is around 24,500.

"I think the market is looking for something that can take costs out," Reoch said.

"Given that staff represent 50 per cent of their costs, it's a sad fact of life but it's the best way to get costs out."

Not all of the Australian jobs would be wiped out completely. NAB said many would be transferred to other companies it intended to use to outsource some functions.

But the Finance Sector Union fears the bank may also be looking overseas to places such as India for some of its outsourcing requirements.

"We have been ... trying to convince them not to go down that path," said union communications manager Rod Masson. He said NAB chiefs were making the job cuts because of "a mess of their own making".

NAB has said it expects its earnings to bottom in the first half before returning to an acceptable growth profile over the second half and into next year.

Its net profit is expected to be up by about 20 per cent to A$2.5 billion for the six months to March 31, 2005.

But the figure will include a one-off A$1.1 billion gain from the sale of its two Irish banks, so that underlying earnings are substantially lower than the headline figure.

- AAP