Newcastle Building Society is to close 19 of its branches outside of those in its core North East heartland.
The Society says the branches have become “increasingly unviable due falling customer usage”.
In all Newcastle, will close 19 of its 52 branches located in Edinburgh, Manchester, Sheffield, Nottingham, Doncaster Leeds, Leicester, Falkirk, Leeds, Bradford and Hull, among others. The Society says it intends to try and keep redundancies to a minimum, offering voluntary redundancies wherever possible.
It says the closing branches have become increasingly underused by customers and that it believes this trend will continue over the longer term making it difficult to justify keeping them open. It also says staff recruitment at its outlying branches has been difficult with average staff turnover in these branches twice that of those in its North East heartland. Newcastle says this is because of low levels of staff satisfaction due to lack of work. Staff in the closing branches complete 39 transactions a week on average accounting for a mere 14% of the total branch-based customer transactions.
Newcastle reported growth in financial assets of 6.36% to £3.27bn at the end of 2004 but says this growth was achieved thought direct channels, such as call centres and the internet and through building a financial advice based business through its central North East branches as well as moving into non core areas such as partnering with other financial services providers.
Robert Hollinshead, chief executive of Newcastle Building Society, says: “Announcing the closure of a number of branches across the country has been a difficult decision, and we regret deeply any inconvenience to customers. However, the business reasons for the branch closures are compelling. I know some customers will be upset at this move, but it is best for the society as a whole. The Society will be concentrating on branches in its North East heartland where branch usage is high and the brand offers a competitive advantage. There are no plans to make further closures.”
Frank Needham, regional officer at Amicus, says: "Our initial reaction was one of shock that so many branches were to close resulting in almost 100 possible job losses. Amicus naturally regrets that the Society's board of directors have come to this conclusion but understands the economic rationale. Amicus has been fully consulted and is working constructively with the company plus we have assurances from chief executive, Robert Hollinshead that there will be no further branch closures."IFAonline
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