AP – Northern Rock PLC will slash one-third of its staff and cut its home loans book by half as it phases out financial support from the government over the next three to four years, the British lender said Tuesday.
Under the plan, which must be approved by the European Commission because it relies on continued state aid, most of the job cuts would be made in the first year, with the rest going by 2011. The bank currently has around 6,500 employees.
Northern Rock was nationalized last month after exposure to short-term money markets forced it to seek emergency funding from the Bank of England, leading to Britain’s first bank run in more than a century.
Taxpayers have so far funded subsidies to the stricken mortgage lender to the tune of 55 billion pounds ($107 billion).
