ABN Amro Holding NV tries to fight the decline in earnings by cutting 3% of its workforce, or 2,850 jobs.
The largest Dutch bank plans to take a charge of 790 million euros ($1.1 billion) in 2004 and start saving 770 million euros per year since 2007, according to spokesman Hans van Zon.

Most of the layoffs will take place in Europe, including 1,100 jobs in investment banking and corporate lending and 1,200 in information technology. 8% of the cuts will be in the US and 6% in other countries in North and South America.

``To get any profit growth in the coming years, they’ll have to lower costs, so shedding jobs makes total sense,’’ said Ivo Geijsen at Bank Oyens & Van Eeghen in Amsterdam who gave a ``neutral’’ rating to the bank’s shares.

ABN Amro CEO Rijkman Groenink, predicted in November a drop in operating profit in 2004 on the expected decline in the North American mortgage market on the US rate hike. ABN Amro restated its forecast of 10% growth in net income for 2004.

In the first half of 2004, 46% of ABN Amro’s profit was earned in North America, with the Netherlands and Brazil accounting for 19% and 17% respectively.