NAB cost-cutting exercise hits IT

IT will not go unscathed by the National Australia Bank's plans to cut 1500 jobs Australia-wide.

Reductions in back office, IT and operations will account for just under half of the cost-cutting's generated savings, according to managing director and CEO, Frank Cicutto in the bank's 'Positioning for Growth' media presentation.

Cicutto said the bank will make cost savings of $370 million globally, by September 2004. Back office, IT and operations will account for 43 per cent of this figure.

How badly IT will be affected by the job cuts is unclear as information of divisional job losses is not available, according to a bank spokesperson.

However, the spokesperon told Computerworld before the 1500 job loss announcement, there was "no natural connection" between the previously announced closure of 56 branches and how many IT staff may lose their jobs.

NAB said process re-engineering and streamlining throughout the group as a result of investment in new technology would reduce employment, particularly in administration and back-office areas.

"Technology and process changes mean fewer positions," Cicutto said in the presentation. The job cuts are expected to take place over the next 18 months.

Australian IT investment initiatives NAB announced in its statement include $200 million to be invested over three years within wealth management to create an adviser system. Efficiency gains are also expected through process re-engineering and leveraging of the recently deployed $120 million IP network.

The bank's CRM system will also play a part in increasing revenues, the statement said.

Internationally, $90 million will be spent on further developing the wealth management operation in the UK and $95 million on upgrading the IT systems for customer-facing staff in the UK's Clydesdale and Yorkshire banks.

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