By Marcus Leach

Nationalised bank Northern Rock are set to slash 680 jobs in 2011 as part of their cost-cutting measures ahead of a sale back into the private sector.

Currently the bank employees in the region of 2,600 people, and said the cuts will happen at all levels of the company.

“Economic and trading conditions remain very challenging for a bank like Northern Rock; the mortgage market remains subdued, and the low interest rate environment continues to act as a headwind for banks and building societies primarily funded from retail savings," Executive chairman Ron Sandler said.

“In order to meet our agreed objectives, we must continue to manage our cost base, which is too big relative to the size of the Company - regrettably, this will involve job losses.

“Our aim is to minimise compulsory redundancies where possible and we will offer voluntary redundancy. This is an unsettling time for our employees, who have been through a lot in the last few years. We will keep them well informed throughout the process and provide support to those who are affected."

Following consultation with Unite it has been announced that the first of the cuts will happen before the summer. The news of more cuts comes after the bank almost collapsed in 2007, when it was forced to let 1,300 people go. On top of that 650 people lost their jobs in 2008 as part of the re-sizing having been taken over by the state.

Responding to the announcement Unite's national officer David Fleming labelled the news as "appalling."

“This appalling news of 680 job cuts is scandalous," Fleming said.

"Another round of brutal job cuts is simply a step too far for this workforce that has already lost a third of colleagues. We are witnessing another move to scale back this already lean organisation, in a desperate bid to find a private buyer.

“The staff at this North-East based company have, since near collapse, faced constant change and turmoil with no clarity about their future. Unite will now take our demand for Northern Rock to be returned to mutuality to political representatives. A mutual Northern Rock is the only viable option to ensure that this company once again becomes the flourishing business it once was. The government must begin to heed the demands for a diverse financial services industry.”