Lloyds Group to shutter over 100 branches as cost cutting expands

Major lender also looking at 1,500 roles, closing offices

Lloyds Group to shutter over 100 branches as cost cutting expands

In a move that may push even more customers to local mortgage brokers, Lloyds Banking Group has unveiled plans to shut down 136 additional branches across the UK as part of its ongoing efforts to cut costs and shift towards digital banking services. The closures, affecting Lloyds, Halifax, and Bank of Scotland locations, will take place between May this year and March 2026.

The latest decision follows recent changes allowing customers to access banking services across any of the group’s brands, rather than being restricted to their specific bank. Lloyds Banking Group attributed the closures to a decline in in-person transactions as more customers opt for online and mobile banking.

A spokesperson for the bank explained, “Over 20 million customers are using our apps for on-demand access to their money and customers have more choice and flexibility than ever for their day-to-day banking.”

Read more: Giant UK lender reviews over 1,000 roles as part of restructuring plans

Branch employees impacted by the move will be offered alternative roles within the company.

Additionally, customers will still have access to banking services through telephone banking, community bankers, or any remaining Lloyds, Halifax, or Bank of Scotland branches. “Customers can also do their everyday banking at over 11,000 branches of the Post Office or in a Banking Hub,” the spokesperson added.

Beyond branch closures, Lloyds has also announced significant workforce reductions, with approximately 500 roles set to be cut as part of a broader restructuring effort aimed at modernising operations and enhancing digital services. The bank is reviewing over 1,500 roles across multiple departments, including customer service, sustainability, marketing, and digital experience. While some jobs will be eliminated, Lloyds intends to create 151 new positions in line with evolving business demands.

The decision has drawn criticism from trade unions. Accord, which represents Lloyds employees, noted that operational and commercial banking staff would be among those most affected.

However, Lloyds defended the move as part of its long-term business strategy. The company stated, “To achieve the ambitious strategy we launched in February 2022 and deliver a better service to our customers, we are transforming our business.”

The restructuring extends to office closures as well. The bank has confirmed it will shut its Liverpool and Dunfermline offices, with employees being relocated to Chester and Edinburgh. Most affected Liverpool-based employees, particularly those in fraud prevention and customer service, had already transitioned to remote work before the official closure announcement.

Unite’s national officer, Dominic Hook, expressed concerns over the impact on regional employment, particularly criticising the closure of the Liverpool Speke centre, calling it a “huge mistake.”

Figures: ONS data

The changes come as the banking sector continues to navigate the balance between digital transformation and workforce reductions. Lloyds has also adjusted its hybrid working policies, requiring staff to spend at least 40% of their working hours in-office. Senior employees’ adherence to this policy is now a factor in performance-related bonuses.

Additionally, Lloyds is revising its bonus structure, increasing potential rewards for its lowest-paid employees. The move has been welcomed by trade unions but raises concerns about whether it will come at the expense of existing bonus structures for other staff members.

The shift aligns with industry-wide trends, as major corporations, including JP Morgan Chase and Amazon, refine their remote working strategies. Companies like Asda and Santander have also introduced hybrid working models to balance operational efficiency and employee flexibility.

Meanwhile, Lloyds is investing heavily in its future, with £200 million allocated to transforming the Scottish Widows headquarters in Edinburgh. The Port Hamilton building, located in the city’s financial district, will be redesigned in partnership with Drum Property Group and is expected to remain the brand’s head office for its pensions and investments business once renovations are completed in 2027.