Lloyds’ digital refocusing has reportedly placed more than 2,500 jobs at risk.
The British banking giant is planning to review thousands of middle management roles, the Financial Times (FT) reported Sunday (Nov. 26), citing a source familiar with the matter. The report also noted that Lloyds — which has around 60,000 workers — says it is “evolving and transforming” to better serve customers’ needs.
According to the FT, mainstream banks in the U.K. have pulled back from their Main Street businesses, with 1 in 8 branches set to close by year’s end. The report cited figures from consumer group Which? showing that the U.K. will soon have just 4,000 brick-and-mortar bank branches nationwide, with 5,600 shuttering in the last eight years.
Lloyds last year announced a five-year plan to diversify its business, investing $5.2 billion in digitization while also upping its fee income in sectors like wealth management. A source told the FT this new restructuring is part of the bank’s digitization efforts, which could create as many as 120 jobs.
“We’re delivering one of the largest transformations in U.K. financial services which includes reviewing how our business and technology teams work together effectively to deliver on our strategy and long-term growth,” Lloyds said.
That shift is happening on this side of the Atlantic as well, PYMNTS wrote last month, with bank earnings suggesting “some critical mass as consumers continue to use online channels to conduct at least some aspects of daily financial life.”
Earnings calls for banks that include JPMorgan, Citigroup and Wells Fargo indicate that “the branch experience itself is changing, and is being reinvented to fit more fully into an omnichannel effort to meet consumers where they want to be met,” that report said.
Meanwhile, last month saw a report that bank branches based inside supermarkets were closing down at a rate that is seven times higher than that of other branches.
Data from the Federal Deposit Insurance Corp. (FDIC) showed American banks closed 10.7% of their in-store branches in the year ended June 30, compared to a closure rate of only 1.4% for other branches during the same time frame.
A report by CNBC noted several factors leading to this trend, including the banking sector’s ongoing reduction of its branch networks. And banks have shifted their focus to branches that can provide a wider array of services, something not often found at the in-supermarket branches.