In its circular yesterday, Lloyds TSB announced that as a result of the banks merging to become the Lloyds Banking Group, 15.7 per cent of the combined cost base of Lloyds TSB and HBOS in 2008 will be cut by 2011.

The ‘cost synergies’ named that would help the banks to achieve these cuts did not directly mention job cuts, however, rumours are rife that job losses are inevitable.

The cost cutting measures will, according to Lloyds TSB, be made through insurance and investments, wholesale and international banking, central support and retail banking.

Cuts through retail banking will be made by, “optimising the efficiency of the combined retail distribution infrastructure including branch network, call centre operations and associated management and support functions,” and “streamlining branch based functions across operations.”

The word streamlining signifies a shake-up and is causing unrest amongst Lloyds TSB HBOS staff. As a result, Britain’s largest union, Unite has spoken out for the staff, thousands of which are represented by Unite.

Commenting, Unite joint general secretary Derek Simpson said: “It is completely unacceptable for the banks to continue fuelling speculation while leaving their worried staff in the dark.

“It is now time to start thinking about the human consequences of this takeover. None of the staff at these two banks should be forced out. We believe if this takeover is managed properly, with the full involvement of the union, compulsory redundancies can be avoided.

“The bank and the government must remember the wider social impact of this takeover and do everything in their power to protect hard-working families, their communities and to encourage confidence in the economy,” Mr Simpson concluded.

© Fair Investment Company Ltd