Royal Bank of Scotland (RBS) is planning to slash up to 400 jobs in its US trading business over the next two years to prepare for tough new US regulations.
As per the new regulations announced earlier during the year, the foreign banks with US assets in excess of US$50 billion are liable to have additional capital to address losses, which could move them to raise extra equity or debt for US businesses.
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RBS reportedly intends to shrink below the US$50 billion threshold so as to escape the rigorous oversight, instead of adapting to the new regime.
The RBS cuts primarily affect the non-agency mortgage business, and the British bank is expected to retain its securitisation and agency mortgage business, the Financial Times has reported.
The bank will continue to focus on its rates, currency and global-transaction operations. RBS’s US business employs a total of about 2,400 people.
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