Nearly a year on from its spin off from the National Australia Bank (NAB), Clydesdale and Yorkshire Banking Group (CYB) has put more flesh on the restructuring plan first announced in late 2016. In fact the bank is using an axe and not a scalpel to revamp itself judging by the announcement yesterday.
CYBG is cutting 400 jobs and closing 79 branches as part of its cost-cutting measures. That will see the bank shutting about one-third of its network over the course of 2017, taking its total number of branches to less than 169.
CYBG outlined its cost cutting plan last September in order to accelerate its financial targets. It is targeting more than £100 million ($A163 million) of cost reductions by the end of 2019.
The bank said it will invest more than £350 million ($A570 million) over the next two years to simplify the business, reduce costs, boost technology platforms and support the roll-out of new branches and digital services.
The UK union, Unite claimed the cuts represent the “largest ever closure plan” by Clydesdale and will “radically change the face of the bank”.
In a statement, CYBG said: “This ongoing decline in branch usage, married to a sharp and sustained increase in digital and mobile engagement, has driven a shift to providing greater access to day-to-day banking services remotely, on the move and outside of normal business hours.
“The Bank continues to reshape its service offering in response to these changing needs.
“To support this transformation the Bank is committing £350 million over the next two years, embracing digital innovation while continuing to invest in a more sustainable branch network to deliver a superior customer experience.”
And they added: “There will inevitably be employee number reductions as a result of these changes.
“We anticipate that around 200 Clydesdale Bank staff will be at risk of redundancy and subject to our redeployment process.”
And Gavin Opperman, a director at the banking group, said overnight in the statement: “While the decision to close any branch is never an easy one, it is important that we, in line with other banks operating in the UK market, continue to respond to changes in the way customers want to bank with us.”
A spokesperson for the bank said it will attempt to redeploy staff affected by the job cuts. The shares fell by 0.4% on the ASX yesterday to $4.75.
