Wellington, Feb 27 NZPA - Global financial services firm ABN Amro is withdrawing from New Zealand with the loss of jobs.
The move is an embarrassment for the Government and NZX chief executive Mark Weldon on the day of the jobs summit.
But the closure is the unwinding of a long running situation resulting from a debt-burdened global bank merger and locally owned stock broker ABN Amro Craigs is expanding as a result of the withdrawal.
It is understood the deal happened quickly and was timed to coincide with announcements by ABN Amro's owner Royal Bank of Scotland (RBS) overnight.
ABN Amro Craigs said it is buying out RBS's 50 percent stake in its business and will have a strategic alliance with RBS going forward. It will take on some of ABN Amro New Zealand's staff who will become shareholders in ABN Amro Craigs.
In effect, ABN Amro Craigs is expanding into investment banking for the "big end of town". It already did investment banking work for small clients.
It will expand into merger and acquisitions, capital and debt raising for larger clients, competing with the likes of Deutsche Bank, Goldman Sachs JBWere and First NZ Capital.
ABN Amro Craigs is a New Zealand success story. Neil Craig set up shop in Whakatane in 1984 and the business grew to become the largest stock broker in New Zealand in terms of advisers.
The ABN Amro New Zealand business, an investment banking operation headed by Simon Allen, will close. The National Business Review reported 60 jobs will be lost.
Mr Allen will continue to be a director of ABN Amro Craigs but was not joining the business, chief executive Neil Craig said.
RBS overnight announced the biggest loss in British history and said it is withdrawing from New Zealand.
Last year it failed to sell its ABN Amro business in Australia and New Zealand to Commonwealth Bank of Australia.
ABN Amro Craigs said it will change its name later this year.
"There will be no change to the operation of our business, the people leading the business or those advising our clients," said ABN Amro Craigs chief executive Frank Aldridge.
RBS and partners Banco Santander SA of Spain and Fortis of Belgium outbid Barclays for Amsterdam-based ABN Amro to complete the biggest banking acquisition in history. Like many who bought a big asset before credit was crunched they ended up selling assets to repay debt.
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