Shares in Lloyds Banking Group opened 1.2 per cent lower this morning as it confirmed the loss of 9,000 jobs and closure of 150 branches over the next three years, despite a 35 per cent rise in profits.
In a statement, the bank confirmed its efforts to rebalance would lead to redundancies.
We anticipate a reduction of approximately 9,000 full-time roles across the business while building new capability in digital and IT. We will also further rationalise our legal entities, including our life companies.
As part of the same strategy, there will also be branch closures.
We are committed to maintaining or growing our share of branches and will optimise our network by consolidating mainly urban branches in overlapping locations. We anticipate this will lead to a net reduction of about 150 branches.
Halifax branches are to be maintained.
The bank hopes that this simplification strategy will yield a much more efficient model. Its adjusted targets are for a cost to income ratio of 45 per cent, and aims to make further reductions totalling £1bn a year by the end of 2017.
The news came as Lloyds posted third-quarter results showing underlying profits rose 35 per cent to £6bn in the nine months to the end of September, as profit before tax fell slightly to £1.6bn, from £1.7bn during the same period the year before.
Profit before tax rose to £751m in the third quarter, an improvement on the £440m loss reported a year earlier.
The group added that it had already reduced costs by 6 per cent.
Under the new strategy, Lloyds said its new focus will be on digital, with plans to "invest about £1 billion to deliver simple and efficient digital products and services for customers across our businesses."
António Horta-Osório, Lloyds's chief executive, said:
Over the last three years the successful delivery of our strategy has ensured that we have become a safe, highly efficient, UK focused retail and commercial bank. The next phase of our strategy builds on these strong foundations to meet the rapidly changing needs of our customers, and sets out how we plan to grow the business to become the best bank for customers and deliver superior and sustainable returns for our shareholders