Co-operative Bank says low interest rates behind decision to cut 200 jobs

 
Caitlin Morrison
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The Co-op Bank said interest rates are to blame for job cuts (Source: Getty)

The Co-operative Bank is cutting 200 roles across the business in a bid to cut costs. The roles will be made redundant by the end of March 2017.

The bank said low interest rates were partly to blame for the job losses, as it is struggling to make money in the current economic environment.

The roles affected are management and head-office roles, mainly based in Manchester and Stockport, and "are focused on areas where processes can be simplified and streamlined further as the bank restructures the business into a simpler bank". No branches will be closed.

“Decisions such as these are never easy, but these cost reductions are critical to progressing our turnaround and delivering a cost base which supports a sustainable core bank," said the bank's deputy chief executive, Liam Coleman.

"Regrettably, this means we have today briefed colleagues on our proposals to make around 200 roles redundant. Over the coming weeks we will continue to consult with colleagues and trade unions on these proposals and our focus will be to ensure that all impacted colleagues are treated sensitively and respectfully."

Turnaround plan

Coleman added: “We have made progress in turning the bank around since 2013 but have always been clear that the bank’s recovery is a difficult journey.

"As we have said before, we will remain loss-making in 2016 and 2017 and whilst we continue to make progress with our turnaround plan, in a challenging economic environment, maintaining our focus on costs and delivery of initiatives are key to building a more resilient and sustainable bank. As such, it is important that we take the necessary steps to continue to progress our turnaround.”

The Co-op is still trying to turn itself around after it revealed a £1bn black hole in its finances three years ago, and the bank showed signs of recovery earlier this year, when it reported shrinking losses.

A real blow

Unite the union slammed the bank over the "breadth and the speed of the planned cuts", saying they will hit the Co-op's "much cherished customer service and with it the bank’s unique selling point".

“Compulsory redundancies are anathema to all trade unions, but the timing of this exercise just before Christmas is a real blow to our members," said Unite national officer Rob MacGregor.

“We will be supporting our members through this difficult time - and pressing the bank to reconsider these cuts where possible - which will leave loyal staff facing an uncertain Christmas and worrying New Year.”

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