Royal Bank of Scotland is to close 162 branches in England and Wales this summer with the loss of nearly 800 jobs, raising fresh concerns that many rural communities will soon be left without access to a bank branch.
RBS said the job losses were the result of a deal made with the European Union last year that meant the Edinburgh-based bank would no longer be forced to sell 300 branches. Instead 60% of them will be shut down.
The EU had demanded the sale, to increase competition, as a condition of the RBS taxpayer bailout in 2009. RBS resurrected the Williams & Glyn name for the branches it put up for sale – which were RBS banks in England and Wales together with NatWest branches in Scotland. However, it was unable to find a buyer.
The closures affect branches across England and Wales, from Truro to Colwyn Bay and Barrow-in Furness, with 11 in London.
The bank said 109 brancheswould close in July and August and 53 would shut in November, with 792 staff to be made redundant.
The latest closures come after years of shutting down branches, which have prompted political outcries and warnings about the end of high street banking. Only five months ago RBS announced it was closing 259 branches with the loss of 680 jobs.
After the latest round of cuts the bank will have 859 branches remaining, about 1,000 fewer than at the end of 2014. Nicky Morgan, chair of the influential Treasury committee, criticised the RBS decision, and said the government may have to intervene if closures worsened financial exclusion. RBS is still 71%-owned by taxpayers.
She said: “In recent years, retail banks have made decisions to shrink their branch network on the grounds that more people are banking online. But branches remain vital for many, particularly vulnerable people and those in rural areas.
“As a result of RBS’s decision, there is a risk of increased levels of financial exclusion. It’s important for the government to monitor this trend. If financial exclusion is increasing, the government may be required to intervene.”
Jonathan Reynolds, Labour’s shadow City minister, said: “These closures and job losses are devastating for RBS staff and the communities they serve. Concrete plans must be put in place to ensure vulnerable customers do not suffer as a result.
“Under a Labour government, there would be mandatory consultation around the closure of bank branches which includes the regulator. We cannot abandon communities by leaving them without the basic banking infrastructure they need.”
The Unite union called on RBS to halt its “disastrous plans”. It claimed that in 71 out of the 162 locations slated for closure, customers will be forced to make return journeys of about 25 miles.
Unite’s national officer, Rob MacGregor, said: “The TSB computer systems crash last week has demonstrated without question that the banking system needs its branch network more than it ever has. Unite is calling on the Royal Bank of Scotland management not to abandon their responsibilities to communities across the country.”
RBS said the majority of branches marked for closure were within 0.6 miles of another RBS or NatWest branch, pointing out that all of them were within 2.5 miles of another branch.
The bank also said the number of branch transactions in England and Wales had fallen 30% since 2014, while mobile transaction numbers had surged 74% over the same period. The number of customers using mobile banking has risen by 53%.
Last week, RBS reported first-quarter profits had more than trebled to £792m.
The bank pledged to increase telephone banking services and improve online and app messaging services. It has created a specialist taskforce to help customers learn to use the new banking technology.
The Federation of Small Businesses said the closures would deal another blow to small firms and high streets.
The FSB’s national chair, Mike Cherry, said: “It’s thoroughly disappointing to see RBS using the failed sale of Williams & Glyn as an excuse to further decimate the UK’s bank branch network.
“This fresh round of closures will hurt high streets all over the country at a time when thousands of small firms are already struggling. When a bank branch goes it means less footfall, less cash in the local economy and less revenue for local small firms as a result.
He added that if small firms cannot easily deposit their takings, it makes them targets for theft. “Many small business owners have built relationships with branch personnel that go back years – that’s not something that can be replaced by an app.”
