British state-owned Royal Bank of Scotland PLC (RBS) yesterday said it expects to close 259 branches and cut 680 jobs as it reduces costs and encourages customers to use online and mobile services.
The latest round of closures at the Edinburgh-based bank follow 180 announced in March, putting 1,000 jobs at risk, and a similar move by Lloyds Banking Group PLC, which on Wednesday said it would close 49 branches.
British banks are set to close a record 762 branches this year, Reuters reported in August, drawing criticism for depriving customers of access to in-person services, particularly in poorer parts of the country.
Customers are increasingly using mobile and online channels rather than bricks-and-mortar branches, and RBS had to react to that, RBS managing director of branch banking Jane Howard told Reuters by telephone.
“There will be some customers that will be really disappointed that we are closing branches ... and I understand why. But it is important that we do respond,” she said.
RBS is investing in its remaining branches and its digital offering, Howard said, adding: “Given what we know, we have got the right shape of network.”
The latest closures will affect the bank’s RBS and Natwest brands in England, Wales and Scotland, leaving it with around 744 branches.
The bank reported a better-than-expected operating profit for the third quarter of this year after keeping expenses under control and avoiding any misconduct charges, which, along with restructuring costs, have dogged the bank’s return to profitability since the financial crisis.
LEGAL HINDRANCE
RBS hopes to post its first profit since 2007 next year, but that depends on when it reaches a multi-billion pound settlement with the US Department of Justice over the mis-selling of toxic mortgage backed securities in the US.
Meanwhile, one of Sweden’s main financial-worker unions said the job cuts announced in October by Nordea Bank AB are just the beginning of a transformation that is about to hit the whole industry as more financial firms come to rely on digital solutions.
The Nordic region’s biggest bank has yet to reveal to its staff exactly which employees are to be affected by the cuts.
Nordia intends to get rid of 4,000 full-time employees and 2,000 consultants, it said.
Those announcements are to be made internally and department by department at regular intervals over the coming years, the bank said.
Employees at other banks should get ready for similar developments, said Mikael Andersson, head of negotiation at Sweden’s Civilekonomerna, an association of graduates in business and economics.
“Nordea, with its announced job cuts, is no exception,” Andersson said by telephone on Thursday. “This development with rationalizations will also happen at other banks, as it is general.”
Nordea chief executive officer Casper von Koskull has gone so far as to say that the financial industry might have half as many workers a decade from now as it adjusts to a digital revolution that will make several human functions redundant.
This will affect simple tasks like reporting lost or stolen credit cards, but can even be extended to more sophisticated jobs, including functions supporting investment banking, Nordea chief digital officer Ewan MacLeod said.
“The whole sector is sitting in the same structural boat,” Andersson said. “What Nordea talks about are costs for technology development of, for example, savings solutions and partly robotized services, and digitization. These developments are coming across the banking and financing sector.”
Additional reporting by Bloomberg
Napoleon Osorio is proud of being the first taxi driver to have accepted payment in bitcoin in the first country in the world to make the cryptocurrency legal tender: El Salvador. He credits Salvadoran President Nayib Bukele’s decision to bank on bitcoin three years ago with changing his life. “Before I was unemployed... And now I have my own business,” said the 39-year-old businessman, who uses an app to charge for rides in bitcoin and now runs his own car rental company. Three years ago the leader of the Central American nation took a huge gamble when he put bitcoin
TECH RACE: The Chinese firm showed off its new Mate XT hours after the latest iPhone launch, but its price tag and limited supply could be drawbacks China’s Huawei Technologies Co (華為) yesterday unveiled the world’s first tri-foldable phone, as it seeks to expand its lead in the world’s biggest smartphone market and steal the spotlight from Apple Inc hours after it debuted a new iPhone. The Chinese tech giant showed off its new Mate XT, which users can fold three ways like an accordion screen door, during a launch ceremony in Shenzhen. The Mate XT comes in red and black and has a 10.2-inch display screen. At 3.6mm thick, it is the world’s slimmest foldable smartphone, Huawei said. The company’s Web site showed that it has garnered more than
Demand for artificial intelligence (AI) chips should spur growth for the semiconductor industry over the next few years, the CEO of a major supplier to Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) said, dismissing concerns that investors had misjudged the pace and extent of spending on AI. While the global chip market has grown about 8 percent annually over the past 20 years, AI semiconductors should grow at a much higher rate going forward, Scientech Corp (辛耘) chief executive officer Hsu Ming-chi (許明琪) told Bloomberg Television. “This booming of the AI industry has just begun,” Hsu said. “For the most prominent
PARTNERSHIPS: TSMC said it has been working with multiple memorychip makers for more than two years to provide a full spectrum of solutions to address AI demand Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said it has been collaborating with multiple memorychip makers in high-bandwidth memory (HBM) used in artificial intelligence (AI) applications for more than two years, refuting South Korean media report's about an unprecedented partnership with Samsung Electronics Co. As Samsung is competing with TSMC for a bigger foundry business, any cooperation between the two technology heavyweights would catch the eyes of investors and experts in the semiconductor industry. “We have been working with memory partners, including Micron, Samsung Memory and SK Hynix, on HBM solutions for more than two years, aiming to advance 3D integrated circuit
RSS