Santander to Close Over Fifth of UK Branches, Putting 750 Jobs at Risk
The banking giant's decision reflects a shift in customer behavior towards online banking, raising concerns about the future of physical banking services.
Santander has announced plans to close more than a fifth of its high street branches in the United Kingdom, resulting in approximately 750 job losses.
The Spanish banking institution will shutter 95 of its 444 branches, effective June 2023, and will also reduce operating hours at 36 locations while transitioning 18 branches to a counter-free model.
Following the changes, Santander will maintain a total of 349 branches across the UK, including 290 full-service locations alongside five work cafes.
The proposed cuts to the workforce, amounting to over 4% of the bank's 18,000 UK employees, primarily stem from the branch closures, although around 12% of the job losses relate to the reduction in hours at specific sites.
This decision comes amidst ongoing inquiries regarding the sustainability of Santander's presence in the UK market, despite assurances from its parent company, Banco Santander, to remain committed to the region.
Demand for physical banking has waned, with the bank reporting a 63% increase in digital transactions since 2019, while transactions at branches have decreased by 61% during the same period.
Other major banks in the UK have also been reducing their branch networks.
Recent data indicates significant branch closures across the sector since the onset of the pandemic.
For instance, Lloyds Banking Group announced 136 closures in January, with at least 1,879 branches closed by major banks since early 2022, according to the UK cash access network Link.
Santander's strategy includes opening reduced-hour branches, with most of these locations set to operate just three days a week, reflecting a trend towards optimizing resource allocation in response to customer behavior.
In a shift towards community engagement, the bank plans to recruit 95 new “community bankers” tasked with visiting local areas, including libraries and community centers, to provide financial services.
As part of the restructuring, Santander expressed its intention to replace the closed branches with banking hubs, which will be established by Cash Access UK, an initiative funded by multiple UK lenders.
The establishment of 18 new banking hubs has been outlined as necessary to serve local communities following the closure of physical branches.
In response to Santander’s plan, industry voices have raised concerns over the implications for customers reliant on in-person banking services, highlighting the urgency for effective alternative solutions such as banking hubs.
Advocacy groups are calling for a speedier rollout of these hubs to mitigate the impact of branch closures, urging the government to ensure compliance with existing commitments from banks to provide continued access to banking services in underserved areas.
The Spanish banking institution will shutter 95 of its 444 branches, effective June 2023, and will also reduce operating hours at 36 locations while transitioning 18 branches to a counter-free model.
Following the changes, Santander will maintain a total of 349 branches across the UK, including 290 full-service locations alongside five work cafes.
The proposed cuts to the workforce, amounting to over 4% of the bank's 18,000 UK employees, primarily stem from the branch closures, although around 12% of the job losses relate to the reduction in hours at specific sites.
This decision comes amidst ongoing inquiries regarding the sustainability of Santander's presence in the UK market, despite assurances from its parent company, Banco Santander, to remain committed to the region.
Demand for physical banking has waned, with the bank reporting a 63% increase in digital transactions since 2019, while transactions at branches have decreased by 61% during the same period.
Other major banks in the UK have also been reducing their branch networks.
Recent data indicates significant branch closures across the sector since the onset of the pandemic.
For instance, Lloyds Banking Group announced 136 closures in January, with at least 1,879 branches closed by major banks since early 2022, according to the UK cash access network Link.
Santander's strategy includes opening reduced-hour branches, with most of these locations set to operate just three days a week, reflecting a trend towards optimizing resource allocation in response to customer behavior.
In a shift towards community engagement, the bank plans to recruit 95 new “community bankers” tasked with visiting local areas, including libraries and community centers, to provide financial services.
As part of the restructuring, Santander expressed its intention to replace the closed branches with banking hubs, which will be established by Cash Access UK, an initiative funded by multiple UK lenders.
The establishment of 18 new banking hubs has been outlined as necessary to serve local communities following the closure of physical branches.
In response to Santander’s plan, industry voices have raised concerns over the implications for customers reliant on in-person banking services, highlighting the urgency for effective alternative solutions such as banking hubs.
Advocacy groups are calling for a speedier rollout of these hubs to mitigate the impact of branch closures, urging the government to ensure compliance with existing commitments from banks to provide continued access to banking services in underserved areas.
