Santander UK’s announcement on Wednesday that it plans to shut a fifth of its branch network has raised concerns about the bank’s future in the UK. The move, which could result in around 750 job losses consist of the closure of 95 out of 444 branches by June. The bank which has faced speculation over its long-term presence in the UK, will retain 349 branches, including 290 full-service locations and 36 branches with reduced hours. Like many other UK banks, Santander has been scaling back its physical presence as customers increasingly turn to digital banking, reported news agency Reuters. Since 2019, the bank has reported a 63% rise in digital transactions, while in-branch financial transactions have declined by 61% over the same period. Despite this, the closures have sparked criticism from UK lawmakers, who argue that they harm local businesses and make it more difficult for vulnerable customers in rural areas to access banking services.
In response to these concerns, the Financial Conduct Authority (FCA) introduced new rules in September to make it more difficult for banks to close branches without ensuring that customers have free access to cash alternatives.Santander UK explained that the decision to close branches was part of its strategy to align with customer behaviour. “As a business, we must move with customers and balance our investment across all the places where we interact with them,” said the bank. “Closing a branch is always a very difficult decision, and we spend a great deal of time assessing where and when we do this and how to minimize the impact on our customers.”
The bank added that it is consulting with employee unions and will provide support to affected staff, including assistance with finding alternative roles within the bank.
In its most recent financial report, Santander UK posted a 38% drop in annual pre-tax profit, totalling £1.33 billion ($1.73 billion) in 2024. The bank employs approximately 18,000 people.
Despite reports in January suggesting that Barclays had explored a potential offer for Santander UK’s operations, the parent company reiterated last month that its UK unit remains a key part of its globally diversified business strategy and is not for sale.