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HSBC to Shut 69 UK Branches Amid Shift to Digital Banking
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As the number of people visiting bank branches declines drastically amid the shift to digital banking, specifically post the pandemic, HSBC Holdings plc (HSBC - Free Report) has decided to shut 69 of its branches in the U.K. The move is expected to impact the jobs of 400 employees.
HSBC said that less than half of its customers in the U.K. now actively use its branch network.
Thus, the move is part of the bank’s “transformation” on how branches operate within individual communities.
By the end of 2022, a number of London branches will close. Other affected cities include Birmingham, Manchester and Bristol.
Jackie Uhi, the head of HSBC U.K’s branch network, stated, “The way people bank is changing — something the pandemic has accelerated. Our branches continue to support people with their more complex banking needs, but the way we can do this has also evolved. Rather than a one-size-fits-all branch approach, it’s an approach built around the way different customers are choosing to bank in different areas.”
Nevertheless, according to HSBC, none of the affected jobs will be at risk. HSBC said, “We aim to redeploy all affected colleagues to other roles within the bank.”
The bank is expected to replace the affected branches with other banking services like new ATMs and pop-up banks.
In January 2021, HSBC announced the closure of 82 of its branches in Britain, which left the bank with nearly 510 branches in the U.K.
Now, HSBC’s decision to shut 69 more branches reflects that customers are rapidly moving away from more expensive physical locations to the popular low-cost digital offerings.
In March 2021, Banco Santander, S.A. (SAN - Free Report) announced its plans to permanently close more than 100 branches and shut down regional offices in the U.K. Moreover, as part of an overhaul of its U.K. business, SAN shifted headquarters from London to Milton Keynes, and invested $205 million in constructing a campus there.
Banco Santander’s head of branches, Adam Bishop, stated, “Branch usage by customers has fallen considerably over recent years so we have made the difficult decision to consolidate our presence in areas where we have multiple branches relatively close together. The majority of the closing branches are within three miles of another branch and the furthest is five miles away.”
Similar to Banco Santander, Lloyds Banking Group plc (LYG - Free Report) announced plans of closing office space in the U.K. and moving to more flexible working patterns post the pandemic.
Vim Maru, the Lloyds retail director, noted that its branches were witnessing substantially fewer transactions over the last five years as customers moved toward digitization, which became more pronounced during the pandemic. He added, “Like many businesses on the high street, we must change for a future where branches will be used in a different way, and visited less often.”
Over the past year, shares of HSBC have rallied 5.7%, outperforming 1.3% growth recorded by the industry.
Image: Bigstock
HSBC to Shut 69 UK Branches Amid Shift to Digital Banking
As the number of people visiting bank branches declines drastically amid the shift to digital banking, specifically post the pandemic, HSBC Holdings plc (HSBC - Free Report) has decided to shut 69 of its branches in the U.K. The move is expected to impact the jobs of 400 employees.
HSBC said that less than half of its customers in the U.K. now actively use its branch network.
Thus, the move is part of the bank’s “transformation” on how branches operate within individual communities.
By the end of 2022, a number of London branches will close. Other affected cities include Birmingham, Manchester and Bristol.
Jackie Uhi, the head of HSBC U.K’s branch network, stated, “The way people bank is changing — something the pandemic has accelerated. Our branches continue to support people with their more complex banking needs, but the way we can do this has also evolved. Rather than a one-size-fits-all branch approach, it’s an approach built around the way different customers are choosing to bank in different areas.”
Nevertheless, according to HSBC, none of the affected jobs will be at risk. HSBC said, “We aim to redeploy all affected colleagues to other roles within the bank.”
The bank is expected to replace the affected branches with other banking services like new ATMs and pop-up banks.
In January 2021, HSBC announced the closure of 82 of its branches in Britain, which left the bank with nearly 510 branches in the U.K.
Now, HSBC’s decision to shut 69 more branches reflects that customers are rapidly moving away from more expensive physical locations to the popular low-cost digital offerings.
In March 2021, Banco Santander, S.A. (SAN - Free Report) announced its plans to permanently close more than 100 branches and shut down regional offices in the U.K. Moreover, as part of an overhaul of its U.K. business, SAN shifted headquarters from London to Milton Keynes, and invested $205 million in constructing a campus there.
Banco Santander’s head of branches, Adam Bishop, stated, “Branch usage by customers has fallen considerably over recent years so we have made the difficult decision to consolidate our presence in areas where we have multiple branches relatively close together. The majority of the closing branches are within three miles of another branch and the furthest is five miles away.”
Similar to Banco Santander, Lloyds Banking Group plc (LYG - Free Report) announced plans of closing office space in the U.K. and moving to more flexible working patterns post the pandemic.
Vim Maru, the Lloyds retail director, noted that its branches were witnessing substantially fewer transactions over the last five years as customers moved toward digitization, which became more pronounced during the pandemic. He added, “Like many businesses on the high street, we must change for a future where branches will be used in a different way, and visited less often.”
Over the past year, shares of HSBC have rallied 5.7%, outperforming 1.3% growth recorded by the industry.
Image Source: Zacks Investment Research
Currently, HSBC carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.