Lloyds Banking Group has now confirmed that the next three years will see them close 150 branches, and this will result in the loss of 9,000 jobs. This represents the loss of roughly 10% of the bank’s current workforce.
As well as those high street banks branded under the Lloyds name, the group also owns the Bank of Scotland and Halifax firms.
This is the latest in a series of job cuts made by the major banking group. Since 2008, 43,000 jobs have been cut by Lloyds. This figure excludes those losses that have just been announced, which will take place over the next three years as branches close.
The bank has also dropped its previous pledge to keep “the last branch in town” open. It will now proceed with branch closures without regard to this principle, and has said that it will concentrate on closing down urban branches first.
The group has suffered from a number of fines in recent years for various issues, mistakes and missteps. The PPI scandal, in particular, has hit the Lloyds Banking Group hard. When administration costs of £2.5 billion are included, the PPI scandal has cost the group £11.3 billion to date and a further £900 million has now been set aside to cover future payouts. Recent fines that do not relate to the scandal have totalled over £200 million – a significant figure even if it seems small next to the volume of PPI claims.
Despite these problems, chief executive Antonio Horta-Osorio insists that “the group is performing strongly.” Indeed, over the nine months leading up to 30th September this year, the group reported strong pre-tax profits of £1.61 billion. According to Horta-Osorio, “We have met or exceeded the strategic objectives set out in 2011 and are ready to move on to the next stage in our development.”
The 150 bank closures for the next three years are a net figure, with planned new branches subtracted from the total. The bank actually intends to close 200 of its current branches, but also to open 50 new ones in different locations. With 2,250 branches belonging to the group at present, the overall number of branches owned by the group will have shrunk by roughly 7% once the three-year process has been completed.
A call from the Unite union urges the bank to give a “no compulsory redundancy guarantee.” A spokesman for the union, Rob MacGregor, said “The wallets of top executives at Lloyds should not be getting fat by forcing low paid workers onto the dole.”