FORMER building society Bradford & Bingley (B&B) is to cut staff numbers by about 500 as it strives to reduce costs.

But North-East workers are expected to escape the axe as the cuts are aimed at operational centres, rather than branches, of which there are none in the region.

The group, which employs about 6,900 people, wants to "rationalise" its property portfolio and concentrate its southern operations centres into fewer locations in an effort to save £30m by the end of 2002.

A spokeswoman for B&B said: "We are closing operational centres rather than branches. There are no such centres in the North-East."

The job cuts will be made over then next 18 months.

The move follows a programme announced in February, to cut 300 staff by closing a number of bank branches and estate agencies.

The announcement came as B&B, which floated on the London Stock Exchange in December, said pre-tax profits for the half year to June 30 rose to £119.7m, 22 per cent higher than the same period the previous year.

The rise was mainly due to lower one-off charges in the last half year.

Christopher Rodrigues, B&B chief executive, said: "The business has prospered in its first six months as a plc."

He said the group would keep a "weather eye" on economic conditions and their impact on prospects for retail financial services and the housing market.

Commenting on the mortgage market, Rosemary Thorne, finance director said: "So far we haven't seen any slowdown. There is a lot of talk about the economic climate, but it is very different to the 1990s.