Royal Bank of Scotland is closing two insurance offices in Glasgow, threatening more than 640 jobs.

Bank bosses announced they are axing 14 of the 27 offices in its Churchill and Direct Line business under existing plans to cut 2,000 jobs.

The part-nationalised bank delivered the blow to all staff on Thursday as part of a previously announced move to shed jobs at the insurance division, that it was ordered to sell by the European Commission by 2013.

Glasgow is heavily hit along with offices earmarked in other locations including Peterborough, Cardiff and Bristol.

Staff at Direct Line in Glasgow's Atlantic Quay were told on Thursday afternoon that the office would be closed by the beginning of next year. Staff gathered for a meeting at nearby Radisson SAS Hotel to be told the news.

More than 400 job losses are expected from the closure of Atlantic Quay and another office at St Vincent Street , but said around 200 staff are likely to be redeployed.

RBS - 83% owned by the taxpayer - said in May that 2,000 jobs would go at its insurance arm, which includes the Direct Line, Green Flag, Churchill and Privilege businesses and employs 16,000 people.

The group speeded up the plans after the European Commission said it must sell 318 branches as well as the insurance business to soothe competition concerns following its Government bail-out.

Unite

Rob MacGregor, national officer at trade union Unite, said: "RBS staff are continuing to pay the price for the bank's failure with their jobs. They are trying to do the best job they can during a hugely stressful period of uncertainty.

"Unite is calling on RBS to come clean with staff and clarify the impact of the restructuring and end the uncertainty. Unite will hold RBS to account over any compulsory job losses that result."

Of the 14 insurance sites being closed, two of three are being shut in Birmingham, one in Cardiff, two in Croydon, two in Bristol, one in Farnham, two in Glasgow, one in Ipswich, one in Manchester, one in Peterborough and one in Romford, Essex.

RBS said: "The EU decision requiring the sale of the RBS Insurance business has accelerated our plans for cost savings and having to cut jobs is the most difficult part of this process.

"At this stage it is too early to say how many role reductions this will involve, but we will do all we can to support our staff, offer redeployment opportunities where possible and to keep compulsory redundancy to an absolute minimum."

Scottish Finance Secretary John Swinney said the decision was "hugely disappointing".

He added: "The Scottish Government has been engaged with RBS in an attempt to minimise the number of redundancies in Glasgow.

"The bank has been able to create 200 new job opportunities in the claims centre of excellence in Cadogan Street, which will reduce the number of redundancies from around 600 to around 400.

"Although these will take place over a period of time and the bank has pledged to avoid compulsory redundancies where possible, this is still a significant setback for Glasgow's financial sector."

He said people affected by redundancy will be able to talk to the Government's Partnership Action for Continuing Employment (Pace) team for advice on alternative work.

The insurance job cuts come as it reins in costs to ready the business to offload.

Santander

RBS has already reached a deal to sell 318 bank branches to Spanish banking giant Santander for a premium of £350m on the value of the assets.

However, the group is yet to put the insurance operation on the sale block. It is looking at a potential flotation or trade sale, expected next year or in 2012.

RBS has already said it aims to reduce the number of roles in the group by 23,100 globally. Around 17,100 of these will be in the UK.