Coronavirus: Co-op Bank to cut 350 jobs amid ‘prolonged uncertainty’

The Co-operative Bank has announced plans to cut around 350 jobs and close 18 branches as it cuts costs amid “prolonged economic uncertainty”.

Middle management and head office roles will be among those affected as well as staff employed at the branches earmarked to be shut, the lender said.

The announcement was partly blamed on the cut in the Bank of England interest rate to a record-low 0.1% – a situation that makes it more difficult for lenders to make profits.

It was also attributed to the continuing trend towards online banking across the sector – with branches selected for closure after an analysis of footfall over the course of 2019, before the start of the pandemic.

The closures are expected to be completed by 1 December.

Chief executive Andrew Bester said: “Unfortunately, we’re not immune to the impact of recent events, with the historically low base rate affecting the income of all banks and a period of prolonged economic uncertainty ahead, which means it’s important we reduce costs and have the right-sized operating model in place for the future.”

Mr Bester said the bank was writing to customers with information on alternative options available after branches close, including Post Office counter services, telephone, online and mobile banking.

It said it was now consulting with employees and trade unions, and that it would try to redeploy those affected in alternative posts.

The 18 branches proposed for closure are: Ashton, Bradford, Cambridge, Chatham, Chester, Chichester, City of London, Dartford, Halesowen, Harrogate, Luton, Oxford, Rotherham, Solihull, Truro, Wakefield, Walsall and York.

It comes two weeks after larger state-backed rival NatWest said it was looking for 550 voluntary redundancies – blamed on a shift away from bank counter transactions that has accelerated during the pandemic.

Banks have been counting the cost of the coronavirus-driven recession, with larger lenders setting aside billions of pounds to cover loans that may now not be repaid.

The Co-op, a relative minnow, put aside £11.2m in the first half of this year to cover such “loan impairments”, helping its losses for the period widen to £44.6m.

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