HSBC boss claims closure of branches is 'what customers want'

2023-02-07

HSBC boss sparks anger by claiming the closure of hundreds of branches is ‘what customers want’ after surge in online banking

Ian Stuart, UK CEO of HSBC, grilled about the closures by Treasury committee
He said rate of change in customer behaviours was ‘quite incredible’ in last years
READ MORE: Is YOUR local bank about to close?

A high street bank boss sparked a backlash yesterday after claiming closing hundreds of branches is ‘what customers want’.

Ian Stuart, UK chief executive of HSBC, was grilled about the closures – alongside counterparts from Barclays, NatWest and Lloyds Banking Group – by MPs on the Treasury committee.

Asked by the SNP’s Douglas Chapman whether the closures were ‘all about profitability and reducing costs’, Mr Stuart replied: ‘It’s following what the customers want.

‘Principally we look at the footfall in branches, we look at the products being used in branches and we work out what are the right channels for our customers.

‘The rate of change in customer behaviours has been quite incredible in the last few years.’

Ian Stuart, UK chief executive of HSBC, was grilled about the closures – alongside counterparts from Barclays, NatWest and Lloyds Banking Group – by MPs on the Treasury committee

His comments provoked an angry reaction from campaigners last night.

Caroline Abrahams, charity director at Age UK, said: ‘Bank branches are a lifeline for many older people but their interests are losing out, it seems, to the allure of higher profits.’

Since 2015, banks have axed more than 5,000 sites – 53 per cent of all branches – according to analysis by consumer group Which?, with 662 going last year alone and more on the cards this year.

Bosses argue that the stampede into online and mobile banking means it makes sense to close branches.

But critics point out that where lenders close the last branch in town, communities are left without access to basic banking services, with older and vulnerable people in particular losing a financial lifeline.

EXCLUSIVE Revealed: Five biggest High Street banks have closed more than HALF of their branches since 2015 with HSBC topping the list after axing 69% of their sites – READ MORE

Jenny Ross, money editor at Which?, said: ‘For the significant minority who still rely on cash, having a local, easily accessible bank branch is essential.’

She said millions still use cash every day ‘and rely on it to manage increasingly tight household budgets in the cost of living crisis’.

Mr Stuart told MPs that HSBC – which announced in November it was cutting more than 100 branches – would have 325 left by the end of the year.

He added: ‘We are absolutely committed to a physical footprint in the UK, but we have to get it scaled properly for the long term.’

He said 98 per cent of the bank’s transactions in December were ‘digital’.

But Mr Chapman said after the hearing that the closures were ‘more about what the banks want’ rather than customers.

NatWest’s Dame Alison Rose said the bank, still 46 per cent owned by the taxpayer after its rescue in the financial crisis, had 678 branches – due to fall to 657.

Charlie Nunn, of Lloyds Banking Group, which includes Halifax and Bank of Scotland as well as Lloyds Bank, said it would have 1,277 branches left after its latest closures.

Barclays UK boss Matt Hammerstein said it will have 440 branches.

Labour MP Dame Angela Eagle said there’s ‘cynicism among my constituents that bank CEOs seem much better at putting up interest rates on mortgages than giving back some money to savers’.

The hearing came ahead of banks reporting full-year results from next week, when the scale of their profits from interest rate rises will be in sharp focus.

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