Barclays is to shed up to 150 bankers responsible for issuing loans to medium-sized businesses, The Times has learnt.

Between 125 and 150 jobs will go from Barclays Commercial Bank, the division that serves medium to large companies with turnover of more than £1 million.

The division employs 9,250 people nationwide and the cuts will fall both on the bank's Canary Wharf headquarters in London and on regional offices.

Business lobby groups contrasted the bank's claim that it has been continuing to lend to corporate customers with its need for fewer personnel.

David Frost, director-general of the British Chambers of Commerce, said: “Hopefully these cuts will not restrict the flow of credit to medium-sized businesses. The banks have promised to start lending to business and they are not at the moment.”

The cuts are in addition to the loss of 410 IT workers that was also announced yesterday. About 160 permanent staff and 250 contractors in Cheshire, Northampton and London will lose their jobs.

Barclays said that a review had identified posts that were obsolete or were being duplicated. It said that the process was at an early stage and that it would do everything it could to avoid compulsory redundancies.

Derek Simpson, joint general secretary of Unite, said that Britain's biggest union would work with the company to avoid compulsory job losses and to explore all opportunities for redeployment.

“At this time of economic uncertainty, staff across the industry are working under immense pressure and there is a great deal of nervousness regarding their job security,” he said.

The cuts revealed yesterday come on top of plans announced last February to contract out 1,800 jobs to lower-cost overseas locations over three years. Barclays employs 63,100 staff in the UK.

Tens of thousands of jobs across the financial sector are expected to go as UK banks brace themselves against the recession.

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive