wisconsin troops home

Source: http://www.guardian.co.uk/business/2009/jun/09/lloyds-cheltenham-gloucester-close

• The latest round of cuts will see the demise of 1,600 jobs
• Unite condemns the move as ‘nothing short of disgraceful’

The entire Cheltenham & Gloucester branch network is to close by November, as Lloyds Banking Group cuts another 1,660 jobs after the merger with HBOS.

The bank, which yesterday began repaying its multibillion-pound loan from the taxpayer, confirmed this lunchtime that all 164 C&G branches will shut within five months. This will mean about 1,000 employees will lose their jobs.

Lloyds is also cutting 265 positions across its personal loans division, which will lead to job losses in Chester and Cardiff, with other jobs also going across its retail, personal finance and mortgage sales operations.

The Unite union attacked the move as “nothing short of disgraceful”. It will mean the end of the C&G name on the high street after more than 150 years, but the brand will continue to exist on mortgages sold through brokers.

News of the closures broke this morning, sending Lloyds scrambling to inform C&G staff of the plan and sparking fierce debate online.

One branch worker said that C&G customers should not panic, as “branches will not close for months”. From November, they will have to use one of Lloyds’ 1,800 remaining branches.

Lloyds said that compulsory redundancy would be “a last resort” if it could not find new roles for those affected.

“It is always difficult to make decisions about our business that affect our colleagues,” said Helen Weir, Lloyds’ group executive director for retail banking. “We will work through these changes carefully and sensitively and continue to consult closely with our unions throughout the process.

“Cheltenham & Gloucester is a very strong brand. The strategic focus for C&G from now on will be to further strengthen its intermediary and direct savings businesses. Another major priority for us is to ensure that we manage the closure of the C&G branch network so that it causes as little disruption as possible to our customers. We have a number of measures in place to achieve this.”

Lloyds has already eliminated about 3,000 positions since finalising the takeover of HBOS. Last week it announced 510 job losses across its retail banking arm. It has also decided to drop the Clerical Medical name, which was part of HBOS, with the loss of 300 jobs.

Lloyds employs 140,000 people, and City experts believe 25,000 jobs could eventually go once HBOS is fully integrated.

Unite had already called on Lloyds to end the uncertainty hanging over its workers. Its general secretary, Derek Simpson, warned this morning that closing the C&G network would “rip the heart out of hundreds of local communities up and down the country”.

“Hundreds of staff who have worked hard for years to make the C&G brand a success will view this news as a kick in the teeth,” he said. “UK taxpayers have not poured billions of pounds into this organisation just to see it sack thousands of hard-working people.

“Front-line staff in banks across the country are blameless for the mistakes of management which have brought the important finance industry to the point of collapse. Yet these workers now face an uncertain future as Lloyds abandons C&G’s high street branches. This is truly a dark day for the financial services sector in this country.”

C&G was founded in 1850 in Cheltenham, and was acquired by Lloyds in 1995.

Industry experts had predicted several months ago that Lloyds might drop C&G in favour of Halifax, which is the UK’s biggest mortgage lender and is perceived to be a stronger brand.

Alex Potter, banking analyst at Collins Stewart, believes the closure of the C&G branch network could be an attempt to prevent the European Commission blocking the merger. Shares in Lloyds plunged by a third on 20 May after the bank warned shareholders that it may be forced to slim down its business to win state aid approval from the commission.

“There are still antitrust concerns about the Lloyds-HBOS merger at commission level,” Potter told BBC Radio 4’s Today programme. “Perhaps this is a sop to the regulators.”

Lloyds launched its takeover of HBOS last autumn after the government said it would waive competition rules that would otherwise have made the deal impossible.

Cuts at RBS

Unite also said today that 500 staff at RBS have been told that they are at risk of redundancy.

“The closure of a cash centre in Glasgow impacting around 140 staff and 360 job losses throughout other UK locations will devastate staff. Unite is opposed to compulsory job losses and through continued consultation with the bank will seek to find suitable alternative employment for workers,” said Unite national officer Rob McGregor.

These cutbacks are part of the wide-ranging cutbacks announced in April by RBS, which plans to cut its UK workforce by 4,500.