Friends First to shed 147 Irish jobs

Financial services group Friends First is to cut 147 Irish staff and close its asset finance division as part of a major restructuring of its business.

In a statement the company said this division had been significantly impacted by the global credit crunch which meant its business model of borrowing from the inter-bank market was "no longer sustainable in the current climate".

The closure of this division will ultimately lead to the loss of 98 jobs, although 68 will be made redundant within the next two months with the remainder staying in place for the next five to seven years as the business is wound up.

A redundancy package of seven weeks per year of service - inclusive of statutory - and capped at two years will be put in place. The finance unit is based at the company's head office in Cherrywood, Dublin.

A spokeswoman for the company said the roles performed by staff in this unit would determine who would leave immediately.

The company said it also plans to cut a further 49 staff this year through voluntary redundancies.

It said a decline in new business of around 40 per cent this year in life and pensions market had prompted the decision to cut staff in this area.

Chief executive Adrian Hegarty said the closure of the finance unit was a necessary "because of the lack of availability of credit, at appropriate rates, combined with the downturn in the Irish economy".

"These factors have undermined the business significantly. It is with deep regret that we've reached this decision as Friends First Finance was a successful business for the past 12 years, run by a dedicated and skilled workforce."

The spokeswoman added that the decision had been taken by local management and not by the Eureko group, which owns Friends First.