BANK OF ENGLAND; Thousands of jobs at risk if HQ goes south in merger.
THOUSANDS of jobs could go if the Bank of Scotland moves its HQ to England as part of a pounds 26billion merger deal with the Halifax.
Unions and industry insiders reacted with fury yesterday after the proposals to join forces were revealed.
They would create Britain's fifth biggest bank with more than 1100 branches and 57,000 staff.
But though the Bank of Scotland HQ has been in Edinburgh for more than 300 years, the new company is likely to be based in Halifax, Yorkshire.
Top economic think tank the Fraser of Allander Institute believe more than 100,000 Scots jobs could be hit if the base is moved south.
And it is feared that Scotland's booming financial sector would suffer "a major setback".
Last night, the banking union UNIFI called for an urgent review of the merger plan.
A spokeswoman said: "Obviously this would be bad news, with staff at branches and back office departments,such as call centres, overlapping.
"We are calling for an independent review by the Office of Fair Trading. We are seeking a meeting with the Bank of Scotland urgently."
The bank currently employs 19,500 staff. But experts say that for every bank worker, a further six service jobs are created.
That means the bank supports 117,000 jobs in service industries such as lawyers, accountants, suppliers and caterers.
Professor Brian Ashcroft, policy director at the Fraser of Allander Institute, said there was no doubt the loss of the Bank of Scotland's HQ would be a big economic blow.
He added: "At present there are two major bank HQs in Edinburgh - the Bank of Scotland and the Royal Bank of Scotland. To lose some of that could be very damaging."
Shares in both Bank of Scotland and Halifax shot up yesterday after the talks were confirmed. The Bank of Scotland has recently failed in two previous merger attempts with the NatWest and the Abbey National.
But the latest talks are understood to be at an advanced stage, with Bank of Scotland chief executive Peter Burt set for the top job in the enlarged group.
Yesterday the Bank of Scotland and Halifax issued a Stock Exchange statement saying they were discussing a "merger of equals".
It added: "Discussions are continuing and a further announcement will be made when appropriate."
Sources suggest agreement on the deal could come within days.
A Scottish Executive spokesman said they were keeping a watch on the situation, adding: "We are interested that the outcome of the process is positive for Scotland.
"However, the final decision on mergers lies with the shareholders of the companies concerned and the competition authorities.
SNP leader John Swinney said: "Our interest will be to ensure a very important part of the financial and employment infrastructure of Scotland is retained in Scotland, with the significance of the Bank of Scotland."
Bank of Scotland bosses have been under pressure to do a deal after losing a battle last year with Royal Bank of Scotland for NatWest.
Then in February, it failed to clinch a merger with the Abbey National.
Analyst Kitty Andrew said: "It's clear the Bank of Scotland needs a deal with someone after its failed merger attempt."
HOW THEY COMPARE
BANK OF SCOTLAND
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|Publication:||Daily Record (Glasgow, Scotland)|
|Date:||Apr 26, 2001|
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