ABN Amro announced plans to cut up to 6,500 jobs, or 10 per cent of its workforce, as the Dutch bank looks to reduce costs as part of its integration with Fortis Bank Nederland.

The job cuts came as Lloyds Banking Group said it would eliminate another 625 jobs across the UK and Wales in its wholesale banking division, as part of the integration of its HBOS business.

ABN said the net job loss would be between 5,500 and 6,500. The group also plans to create 1,500 new positions. The cuts are designed to save the merged entity between €1 billion and €1.3 billion.

The Dutch government bought Fortis Bank Nederland last October, while in December it replaced Fortis as the dominant shareholder of ABN Amro.

The government’s plan is to combine Fortis Bank Nederland and ABN Amro and sell the resulting entity back to the public.

The net job losses at Lloyds will be 325 posts, since the group is creating 300 jobs in the same divisions as the redundancies are falling. These are the commercial banking unit and specialist finance, which provides financing for deals.

The cuts follow Lloyds plan to raise £4 billion to repay preference shares issued to the government at the height of the banking crisis last October.

The capital-raising could see millions of private shareholders in Lloyds could receive payments averaging £300 because of a quirk in the way the bank is strengthening its balance sheet and repaying government money.

The latest Lloyds job losses are part of an ongoing redundancy programme following the takeover of HBOS.

Last month, HBOS said about 985 positions will go from Lloyds' motor finance division as the group, as the group seeks to cut costs, partly by combining sales forces. The group is the biggest provider of car finance in Britain.

ABN Amro was acquired in 2007 by a consortium of Royal Bank of Scotland (RBS), Fortis and Banco Santander and carved up in the biggest banking takeover in history.

The Dutch government now owns the Dutch part of the group after it nationalised Fortis and took on its stake in ABN Amro.

RBS’ acquisition of ABN, under the leadership of Sir Fred Goodwin, is widely regarded as being the catalyst for the bank’s near collapse. It is now 77 per cent owned by the taxpayer after receiving in state funds to bolster its balance sheet.

The job cuts are separate from the 9,000 positions RBS announced it would eliminate last month, which are thought to include many from its ABN Amro business.

Fortis had planned to cut about 7,800 jobs from ABN's Dutch operation before it was taken over by the government. However, those reductions were never implemented and today's plan supercedes this.

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