ABN Amro to cut 900 North American jobs

New York, Dec 29: ABN Amro Bank NV, the biggest Dutch bank and parent of Chicago's LaSalle Bank Corp, today announced plans to cut about 900 North American jobs by the middle of 2007 to reduce costs amid growing competition.

The cuts will total 5 per cent of the North American work force, and occur across nearly all areas of the bank and at all major locations, Amsterdam-based ABN Amro said in a statement.

They follow a 6 per cent decline in third-quarter profit.

''It's part of an effort for us to focus,'' spokesman Shawn Platt said. ''Competition is tough.'' Most cuts will be in the United States and Canada, and employees learned of the plans earlier today, Platt said. It was not clear how many jobs might be eliminated by attrition.

ABN Amro has slashed several thousand jobs since 2003 but struggled to keep costs down as loan losses increase.

Though third-quarter profit totaled 1.5 billion dollars, or 60 cents per share, expenses jumped 16 percent while revenue rose just 13 per cent.

Many banks in the United States face intensifying competition as consumer borrowing growth slows. With long-term interest rates near short-term rates, it has become tougher for banks to charge enough on loans to offset their rising borrowing costs.

''It is imperative that we take a hard look at our clients' needs and align our resources accordingly,'' said Norman Bobins, head of ABN Amro's North American operations, in a statement.

He was unavailable for further comment.

ABN Amro's cuts may be felt particularly in the US Midwest and New York, where several operations are concentrated.

LaSalle ranks No 2 by deposit market share in the Chicago area behind JPMorgan Chase&Co, and No. 1 in the Detroit area, Federal Deposit Insurance Corp. data show.

The company has more than 400 US banking offices. Chicago also houses asset management and private banking units.

New York, meanwhile, is home to ABN Amro's US corporate and institutional banking unit. Most Canadian operations are based in Toronto, and ABN Amro also operates in Mexico.

Chief Financial Officer Hugh Scott-Barrett in October said the bank might divest some businesses within six to 12 months.

Published reports have said ABN Amro may sell all or part of its US mortgage unit, which has offices in Ann Arbor, Michigan, as lending declines. Platt declined to comment on divestitures.

In 2005, ABN Amro decided to eliminate 3,500 jobs, including 1,500 through layoffs, by outsourcing much of its computer work.

ABN Amro shares closed Thursday down 5 cents at 24.67 euros in Amsterdam trading.

Reuters