THE boss of taxpayer-owned Royal Bank of Scotland (RBS), which employs 2,275 people in the North-East, has not ruled out the possibility of making further job cuts despite this week reassuring staff they were through the worst.

Former Easingwold School, North Yorkshire pupil Stephen Hester told The Northern Echo yesterday the swingeing job cuts made earlier this month that took the total number of the bank’s UK-based staff made redundant since the its partial privatisation to about 26,000 was likely to be the last significant announcement for the foreseeable future.

However, until the bank is in a position to sever ties with the Government, the chief executive admitted it continues to operate under the threat of regulatory measures that could force it to shed more staff.

About a third of the 3,500 job losses announced this month were related to RBS’s enforced sale of 318 branches to Spain’s Santander.

The year-long Independent Commission on Banking (ICB) launched yesterday has been charged by the Government to prevent a future bailout of the financial system by the taxpayer.

Under consideration is the option for major UK institutions such as RBS, which has about 51,000 business and 280,000 personal customers in the North-East, to have its retail and investment activities split.

Mr Hester underlined his more pressing concern was to continue making the “tough decisions” needed to rebuild RBS.

“One of the difficult bits of my job is cutting other people’s jobs, one day it will happen to me, I’m sure. My approach is to tell it how it is. We have made some announcements in recent weeks that will lead to job losses. Our staff appreciate that we are being frank and honest in the way that we are making these announcements and understand why we are doing it even though the personal end result is a worrying one.

“We are through the worst (of the job cuts), but that is not the same as saying we are through everything – you can never say ‘never’.

“A chunk of job losses we had to make because the European Union is forcing us to sell a part of our business we didn’t want to sell. The simple consequence of that is job losses, and if we are forced to sell something else against our wishes then, guess what?

we will have to make more job losses,” said Mr Hester who praised RBS staff for putting personal redundancy concerns aside as they serve the bank’s customers.

Sir John Vickers, the former head of the Office of Fair Trading, who is chairing the ICB, said no decisions had been taken yet about the best route to reform, but his team would be asking “hard questions about financial stability and competition.” Its findings are due to be presented in September next year.