Credit card giant MBNA has moved a step closer to selling its Chester operation as it announced it was cutting 400 jobs at the site.
Parent company Bank of America said it was hopeful the redundancies would be achieved through voluntary means.
The operation, which employs 3,500 people at Chester Business Park, was put up for sale by Bank of America in August.
The group says the cuts are part of an efficiency drive in the division and it is believed they will help make the business a more attractive proposition to potential suitors. Bank of America has now started a consultation process with staff at the site.
Its Europe card executive, Ian O’Doherty, 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.”
Former Northwest Development Agency chief executive, Professor Steve Broomhead, is leading a task force set up to secure the future of
the site.
He told LDP Business: “I am not surprised the company is downsizing as its gets ready for sale. Losing 400 jobs at Chester is not good but I think it was probably predictable and could even make the business more attractive in the longer term.”
Last week LDP Business revealed that the Chester division posted a pre-tax profit of £348m in 2010 – up from a loss of £213m in 2009, raising hopes that a buyer will be found. The figures raised hopes that the business could be successfully sold.
Accounts filed at Companies House show MBNA Europe reported operating income – including interest from loans as well as fees and commission income – of £1.6bn in 2010, down from £2bn in 2009.
But the group still managed to post its first profit since 2007 as it focused on core products in the UK and Ireland and reduced its exposure to bad debts.
