ABN AMRO cuts 200 staff

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Dutch bank wields the axe in London while Swiss rival restructures share-based bonuses.

ABN AMRO has cut up to 200 front-office jobs in London and is planning to chop staff numbers by up to 10% more this year, according to senior sources at the Dutch bank.

About 25 of the 200 were made redundant last week, according to a source close to the bank. A senior banker in the global markets business says about one in 10 front-office staff had been fired in recent weeks.

An ABN spokesman says the cuts had taken place over a longer period: "The majority of this was done in 2006. Last week was the tail end."

The London cuts come after the bank said late last year that it would make 900 staff redundant in its North American operations in 2007.

ABN has also changed the way it pays its bonuses. Staff will no longer receive stock as part of their pay but will be offered the option of investing in funds, some of which are managed by the bank.

The spokesman says: "We always offer funds as part of deferred compensation. Following the changes to accounting rules, we will be offering a wider choice."

ABN is due to report full-year results on 8 February and will announce bonuses later in the month.

Last December, Financial News revealed several second-tier banks were shedding jobs and reallocating resources. Dresdner Kleinwort, HSBC and Royal Bank of Canada had announced more than 300 job cuts between them shortly before awarding bonuses.

Sources close to ABN say key revenue producers remain with the bank and changes were made to increase productivity. Gary Page, head of global markets at ABN, says: "Productivity will continue to be one of the key themes for us."

One banker made redundant last October says his redundancy was the start of a series of cuts in the global markets division.

Last October, ABN said it would cut 500 jobs to reduce costs, though no UK posts were due to be affected.

Those reductions came after the bank reported third-quarter results and said profits in its global markets business more than doubled in the nine months to September, helping offset a drop in profits from the global client business.

Most banks cut between 1% and 5% of their staff each year as part of performance reviews.