SOME 50 jobs at Lloyds TSB's back-room processing centre in Scotland are to be outsourced to Bangalore in India as part of a pilot scheme, The Herald learned yesterday - sparking fears for the future of 1000-plus workers at the bank's Atlantic Quay operation in Glasgow.

The LTU, the trade union representing 45,000 Lloyds TSB staff, described this latest development as "very worrying" and warned that the pilot could mark "the thin end of the wedge in Scotland".

While the bank has already outsourced 39 jobs to India from Scottish Widows, its Edinburgh-based insurance business, this will be the first time that banking operations are to be outsourced from north of the border.

Nonetheless, a Lloyds TSB spokesman yesterday insisted:

"This is not news. It's a matter of public record that we announced last November there would be cuts across the group."

However, the bank yesterday confirmed that "around 40" "overdraft management" jobs in Glasgow will be lost to outsourcing in India, with a further 10 employees going to Bangalore as part of an "information exchange and training" programme - although LTU said 50 jobs would be cut in Glasgow during May and June.

Steve Tatlow, assistant general secretary of LTU, said: "The more people the bank sends to India on training missions, the more job losses we can expect in the future. This could well be the thin end of the wedge for many operations in Scotland."

Lloyds TSB employs some 8000 workers in Scotland, which includes the 1017 processing and telephony staff in Glasgow's international financial services district, where the Scottish cuts are being made.

The news emerged yesterday as Lloyds also said it will axe 465 jobs and close five of its centres in the "group operations" division in England and Wales - a unit which also takes in the Glasgow overdraft management team.

The LTU said the 465 job losses are linked to outsourcing, but Lloyds TSB denies it.

The centres to be shut south of the border are in the Welsh cities of Swansea and Cardiff, in Taunton and Plymouth in south-west England, and Stockton in north-west England.

The bank said the work will be moved to centres in Glasgow, Manchester and Birmingham by the year-end.

Of around 500 Lloyds TSB jobs in the UK that are expected to be lost to outsourcing in India this year, it is understood that some 235 will come from the group operations division.

The bank has said its pilot offshoring projects are proceeding according to plan, and it has also confirmed plans to increase to 2500 the number of jobs outsourced to India by the end of 2005.

Lloyds TSB yesterday reluctantly confirmed the 465 job losses - but only after the LTU released the information first.

The bank spokesman said:

"We are very concerned that the LTU has released this information, because we are still in the process this morning of informing the staff. But let me stress that these redundancies are categorically not connected to outsourcing. We are very sympathetic and we will do our damndest to make sure the workers are redeployed elsewhere, but from time to time big organisations have to make efficiencies."

He added: "The LTU think every announcement we make is connected to outsourcing and India."

However, Tatlow said: "Senior management at Lloyds TSB have sought to conceal the fact that these job losses are linked to its strategy of offshoring work to India.

"In fact, the work is to be transferred to other areas of the bank where there is surplus capacity after staff at those locations had their own work transferred to India. In other words, staff in the operations due to close will be victims of offshoring by proxy. And in reality, very few will be taken on elsewhere in the group."

The Lloyds TSB cuts follow the announcement earlier this week by Spain's Santander Central Hispano that it would slash an extra 1000 jobs at Abbey, which it bought last year - raising fears of yet another jobs cull in Glasgow. National Australia Bank also revealed yesterday it would shut 100 of its Clydesdale and Yorkshire branches over the next 18 months.

In an unfortunate conf luence of statements, Lloyds TSB Scotland - in an apparently unconnected announcement - yesterday released an upbeat, feel-good notice about its own business north of the border, which has recently overtaken the Clydesdale as Scotland's third-most-profitable bank.

Although the Lloyds TSB Scotland release makes no mention of Clydesdale in its statement, a spokeswoman yesterday said: "Well, it was in response to the Clydesdale bank announcement. We just wanted to show our commitment to Scotland, because we're in an expansion phase here."

When asked if the bank's Scottish division was aware of the redundancy announcements in England and Wales, and the 40-plus job losses in Glasgow, she added: "We heard about the cuts in England and Wales this morning. Our announcement is not connected."