Lloyds axes IT staff

The company, which reported profits of £2bn (A$4.7bn) for the year, has cut 100 permanent jobs and 110 contractors from the payroll. The work will now be outsourced to three companies in India.

"The loss of jobs is never welcome, particularly as the news has come only one week after the company announced a huge hike in profits," said Martyn Hart, chairman of the National Outsourcing Association.

"Realistically speaking, the same IT spend in India or other offshore locations will enable you to hire significantly more staff. Offshoring is always contentious, but it isn’t necessarily the scourge of UK jobs it is sometimes positioned as being."

The staff cuts came after a review started in May to look at changes to be made in the bank's IT functions.

"First and foremost we've got an agreement with the union for all staff to have another job within the company," said Emile Abu-Shakra, spokesman for Lloyds TSB.

"Then we're going above and beyond this to open voluntary redundancy to all IT staff. Alongside this we'll provide other job offers within the organisation and a training bond for £2,000. (A$4700).

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