The UK’s top retail banks and building societies are continuing
to cut branch numbers across the country, with one out of every
seven branches closed down since 1999, according to research
carried out by RBI. Overall, branch numbers among the UK’s
biggest banks and building societies have declined by an average of
15.3 percent since 1999.
Barclays, the UK’s third-largest retail bank, has had the
highest number of closures – including over 200 in the first half
of this year alone. The bank’s latest figure for branch numbers is
1,810, which is 494 fewer than it had in 1999, a decline of 21.4
percent. A spokesman for Barclays said the recent spike in closures
was mainly because of mergers between overlapping Barclays- and
Woolwich- branded branches. “It’s a general trend across the
industry. The way people do their banking has changed, although the
branch network remains important to us,” he said.
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The RBI survey comes after Spain’s Santander announced in
early December that it would increase its Abbey branch network in
the UK by 300 over the next three years, taking its overall number
of outlets to around 1,000. The branch openings would cancel out 62
closures Abbey has made since 1999, though few have been shut since
Santander’s takeover in 2004.
Alliance & Leicester was the second-worst performer in
percentage terms, with 20.4 percent fewer branches than in 1999.
That was a reduction of 65 – although none of that decline came in
the last three years. The bank has also been fairly successful in
transferring more of its distribution online: in the first half of
2007, 41 percent of it main product sales were generated via the
internet, up from 35 percent in the first half of 2006, with strong
growth in current account internet openings, which were up 67
percent compared with the first half of 2006.
HSBC, which calls itself ‘the world’s local bank’, has instructed a
10 percent fall in its UK branch footprint since 1999, a drop of
161 branches overall. It currently has 1,501 branches. A spokesman
insisted the results did not undermine the brand. He said: “I don’t
think it does. We are the world’s local bank. That’s a very strong
position for us – one of the few banks that can say we are
genuinely a global retail bank. It’s more than a slogan.”
Lloyds TSB, which would not disclose exact figures, gave an
approximate number of 1,950, which represents a decline of about 17
percent – some 393 branches – since 1999.
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By GlobalDataHBOS, which reduced branches by 5.3 percent since 1999, has
slightly increased its number of branches over the past three
years. It plans to open another 80 branches in the next four years.
This reflects a more recent trend, in which the decline in branch
numbers has slowed. The RBI survey showed that over the
past four years, there was an overall reduction of only 4 percent
in branch numbers among the UK’s top banks.
Nasrin Janmohamed, head of UK retail banking at consultancy
Capgemini, said: “I think a lot of the declining branch numbers we
have seen recently have been down to mergers and acquisitions. I
think what we have see recently is the slowing and possibly even
the reversal of branch decline. In mature markets, consumers are
walking the streets and that is the pool of customers all banks
want.”
But Derek French, director of UK pressure group Campaign for
Community Banking Services, said the strategy meant banks focused
resources on metropolitan areas at the expense of rural areas that
relied on bank services.
