LONDON: British state-owned Royal Bank of Scotland (RBS) said yesterday it will close around a quarter of its branches and cut 680 jobs as it cuts costs and encourages customers to use digital services, drawing criticism from legislators.
The latest round of 259 branch closures by the Edinburgh-based bank follow 180 announced in March, putting 1,000 jobs at risk, and a similar move by Lloyds Banking Group which said on Wednesday it would close 49 branches.
The RBS cuts mean British banks are set to close more than 1,000 branches this year, a record according to a Reuters analysis of previous announcements and academic studies.
Britain’s largest banks are disproportionately closing branches in the lowest-income areas while expanding in wealthier ones, taking bricks-and-mortar services away from communities where they are arguably needed most, Reuters reported in June last year.
British opposition MPs took to Twitter to rebuke RBS for the move, which they said would leave some areas without any branches.
“Bailed out by the taxpayer and they repay our communities by withdrawing from them,” tweeted Ian Blackford, an MP from the Scottish National Party. “This has to be stopped.”
Jane Howard, RBS’s managing director of branch banking, said customers are increasingly using mobile and online channels rather than bricks-and-mortar branches, and RBS had to react to that.
“There will be some customers that will be really disappointed we are closing branches ... and I understand why. But it’s important that we do respond.”
RBS is investing in its remaining branches and its digital offering, Howard said, adding: “Given what we know, we’ve got the right shape of network.”