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Around 2,000 jobs in financial services could be lost by the end of the year, according to a new report, but these are likely to be in the slumping property sector.

The labour market report, by Inverness-based Mackay Consultants, says the credit crunch has begun to bite into financial headcount north of the border, thanks to write-downs at Royal Bank of Scotland and HBOS.

Tony Mackay, author of the report, says: “The two banks have seen big write-downs and both are intending to cut jobs, probably 400-500 in Scotland. And we’re expecting a large number of other mortgage lenders to make redundancies.”

He adds that investment operations and fund management look set to continue to expand in Scotland.

Alan Thornburrow, chief executive of Scottish Investment Operations, says recruitment isn’t as aggressive as it was six months ago, but he’s not heard any talk of redundancies in this space.

David Lonsdale, the assistant director of the Confederation of British Industry in Scotland, says: “In economic circumstances such as we have at the moment, it is understandable that firms are having to cut their cloth accordingly. For some, this will mean being more circumspect about taking on new staff, and for others it means looking to scale back the numbers they employ.”

Mackay adds that the commercial lending sector in Scotland could see some lay-offs as the banks put off property developers with revised lending conditions.

“Banks would have previously lent at 50% of the property price if the developer could pre-let 50%, but they’ve now increased that to 90% in some cases. Some property developers therefore don’t see the point in going to the banks for a loan, so we’d expect to see some commercial lending redundancies.”

Lonsdale doesn’t think it looks too grim up north: “While business sentiment in financial services has undoubtedly cooled, the sector in Scotland is substantial and diverse, and has proved very resilient.”