MBNA to axe 400 Chester jobs

MBNA is to cut 10% of its 4,000 strong workforce at its site in Chester.

Bank of America Europe Card Services, which operates the MBNA brand, said it planned to make the 400 job cuts through voluntary redundancies.

The news follows Bank of America’s announcement in August that it is to exit the UK and Irish credit card market.

Ian O’Doherty, Bank of America’s Europe Card executive, said: “The difficult economic circumstances in which we are currently operating and Bank of America’s decision to exit the Europe Credit Card business has prompted, over recent months, a fundamental review of our business with the purpose of streamlining our operations.

“The announced programme of reductions is one of the actions identified through this review, with the objective of making our operations more efficient and preparing the business for Bank of America’s exit.”

MBNA initially set up its base in Chester 18 years ago and Cheshire West & Chester Council has pledged to help secure a buyer for the business, which is the biggest private sector employer in the city.

Steve Broomhead, chairman of Chester Renaissance, said that the announcement should be kept in perspective and regarded as a predictable step by the company to increase its attraction to prospective buyers.

“MBNA Europe have recently announced very good financial figures for 2010 – £236m profit after tax – and are streamlining the organisation to meet requirements of the worldwide financial situation. Both factors likely to find favour with interested parties.”

Bank of America has already sold its credit card business in Spain to Apollo Capital Management and a UK company which offered loans to businesses. The latter, which had a loan book worth around $200m, was sold to Barclays back in April.

The bank operates one of the largest credit card businesses in Europe, with more than $19bn in credit card loans.