TSB Bank to close 86 branches next year

TSB is to shut 86 branches next year in a cost-cutting exercise, resulting in 400 jobs losses and reducing its high street branch network to 454.

The move by chief executive Debbie Crosbie aims to save £100m by 2022, as the bank tries to restore its reputation after last year’s catastrophic IT failure which affected almost 2m customers.

The Spanish-owned bank, which currently has 540 branches, will announce the branches to be shut on 28 November after staff have been told.

The costs of redundancy and other restructuring expenses will total £180m by 2022.

It also announced a spend of £120m on improving its online services and automating some branches over the next three years.

Ms Crosbie’s predecessor Paul Pester resigned after intense criticism over his handling of the breakdown of the bank’s IT systems last year.

Thousands of customers were locked out of their accounts for weeks from April 2018 after the bank tried to switch to a new IT system.

The fiasco cost the bank £366m in compensation and other costs incurred at the time.

Last week, customers once again faced problems, this time with wages and other payments being paid into their accounts.

Announcing the new strategy, Ms Crosbie said: “The plan we’re sharing today involves some difficult decisions, but it sets TSB up to succeed in the future.

“Our new strategy positions TSB to succeed in a challenging environment at a time when we know customers want something different and better from their bank.”

It expects 90% of transactions to be self-service by 2022 and also wants to reduce the time it takes to open and start using a current account from seven days to 10 minutes.

TSB executives were criticised in a report issued last week commissioned by the bank itself from law firm Slaughter and May which found that had executives lacked common sense and tried to install the IT platform last year before fully testing it.

The bank’s situation had raised speculation that Sabadell, the Spanish bank that bought TSB in 2015, would sell it.

However, Sabadell’s chief executive, Jaime Guardiola, said today that TSB was a “key lever to improve our profitability going forward.”

Crosbie said she had made “difficult decisions” amid “a challenging external environment.”

She added: “With a trusted brand, modern platform, and national presence, TSB is well placed to deliver – but we need to make changes to enable us to compete.”

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Written by

Shirin Aguiar


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