BANKING giant Lloyds TSB has revealed plans to axe 5,000 jobs as it reported an eight per cent slide in profits over the last year.

The group said the jobs would go this year mainly from its central and support areas, although 2,000 jobs would be created in "customer facing" sales and service areas. Finance union UNIFI said it would fight any compulsory redundancies and said there was "no justification" for job cuts.

The jobs announcement came as the bank said pre-tax profits for the year to December 31 fell by £310m to £3.55bn against the same period the previous year.

It said the reduction was driven by adverse short-term fluctuations in investment earnings, which stacked up to £648m, caused by the decline in stockmarket values.

The group also reported a decline in profits in its high street banking division and international banking, hit by the troubles in Argentina, although profits from mortgages increased.

News of the job cuts led to an angry attack by union officials.

Iain MacLean, deputy general secretary of UNIFI said: "The bank has not justified this latest round of redundancies. It seems ironic that on the day the bank announces profits of £3.6bn it also announces job cuts.

"We suspect this decision is more about the share price than a coherent long term staffing strategy.

"We will fight to ensure that all job losses are voluntary and staff who want to remain with the bank are offered retraining and redeployment."

A Lloyds TSB spokeswoman said she could not say where the cuts would fall geographically.

"But it is not going to be branches and not customer facing, she said."

Lloyds said it expected the vast majority of the cuts would be made through "voluntary redundancy and normal staff turnover".

The group currently employs 81,400 in total, around 70,000 of them in the UK.

Its financial figures showed that profits from high street banking in the UK slid 18 per cent to £633m, which Lloyds said reflected "substantial investments" it had made to support future growth such as improved products and services.

Profits from mortgages rose seven per cent to £955m, with net new lending of £3.9bn, giving it an estimated market share of 7.1 per cent.

Its insurance and investment division, which includes the Scottish Widows business Lloyds bought in 2000, saw operating profits rise 12 per cent to at £1.6bn. Growth in sales of life and pensions offset a decline from unit trusts, caused by the downturn in the market during the second half of 2001.

Lloyds international banking division was, however, hit by the economic troubles in Argentina, which wiped £100m from profits. The international division reported an overall seven per cent decline in profits at £444m.

Chairman Maarten van den Bergh said: "I am pleased to be able to report that again the group has performed well, particularly against the weakening economic backdrop in the UK and other global economies."