Unlock the Editor’s Digest for free

Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.

Lloyds Banking Group will allow its Halifax, Lloyds and Bank of Scotland customers to use any of its branches across the three brands, fuelling union concerns that the UK lender is preparing to shut hundreds of locations and axe more jobs.

In a memo to staff laying out priorities for the year, Lloyds’ consumer relationship chief Jayne Opperman said the group needed to “evolve how [it] supports customers” in physical branches even as “more people are choosing mobile over any other way to bank”.

“That’s why — from later this year — we’ll make it possible for customers to use any of our Lloyds, Halifax and Bank of Scotland branches, regardless of the brand they bank with, giving them access to the UK’s biggest combined branch network,” she added. 

A quarter of the branches of the UK’s largest high street banking group are in close proximity, Lloyds said in a 2023 internal presentation seen by the Financial Times. The high-street bank has about 932 branches, according to trade union Accord.

Combining banking services across different brands could make some of those branches redundant, adding to concerns that it could pave the way for another round of mass closures.

Mark Brown, general secretary of BTU, an independent union at Lloyds, said the main driver of the decision was “to make it easier for Lloyds to close more branches and save more money” rather than improving customer experience.

“We estimate that Lloyds will be able to close 233 branches at the virtual drop of a hat, with thousands of staff losing their jobs,” he added.

Lloyds said it was “always looking for ways to make banking easier and more flexible for our customers”.

High street banks have closed more than 6,000 branches in the past decade, according to consumer group Which?.

These closures have helped lenders cut costs, but strained local communities’ access to cash and financial services. More than 7 in 10 UK adults use cash at least once a fortnight, according to ATM network provider LINK.

The Labour government has pledged to accelerate the rollout of so-called banking hubs run jointly by banks, Cash Access UK and the Post Office in areas where lenders have retreated. It has set a target of 350 hubs over the course of the current parliament.

Lloyds’ strategy under chief executive Charlie Nunn has been to “deepen its relationship” with customers at the same time as becoming increasingly digital. As part of that effort, the bank has reviewed 2,500 jobs, and in 2023 embarked on a round of job cuts.

Opperman said in her memo that a key priority for the group was increasing its number of mobile app users — from 20mn currently — and that it would update its Halifax and Bank of Scotland mobile apps in coming weeks.

“I know change can feel daunting, but when we embrace it, we create better outcomes for both our customers and colleagues,” she added.