Up to 20% of Coutts’ front line staff are facing redundancy, following the bank’s decision to place a greater emphasis on wealth management in the run-up to the retail distribution review (RDR), Wealth Manager can reveal.
A spokeswoman at the bank said that following a 90-day consultation period which was served to front office staff at the firm, 80% had been offered roles. She said that as it is an ongoing process, the end numbers are yet to be confirmed, and that the number of staff to be cut equated to no more than 2% of head count of the broader company.
She added: ‘The changes relate to the reshaping of our business in line with our ongoing strategy to put a greater emphasis on wealth management.’
The changes follow the bank’s decision to differentiate its wealth management and private banking teams ahead of the RDR.
While clients were previously serviced just by their private banker, who was responsible for both lending and wealth management, they will now be able to seek wealth management services from a dedicated team.
The restructuring represents a change in strategy for the bank and forms part of CEO Rory Tapner’s (pictured) strategic growth plans, which include doubling assets under management by 2015.
The news comes as a series of exceptional costs hit Coutts’ earnings during the first quarter, offsetting a 4% rise in income, which was driven by improved deposit margins and strong treasury income.
Profit in the division fell from 38% to £45 million over the period with expenses up 21%, largely due to Financial Services Compensation Scheme levies.
The private bank was also hit by an £8.75 million fine from the FSA relating to anti money laundering control processes between December 2007 and November 2010.