Lloyds expected to cut 9,000 jobs

Lloyds sign Image copyright PA
Image caption Lloyds operates more than 2,000 branches through its Lloyds Bank, Halifax and Bank of Scotland brands

Lloyds Banking Group is planning to cut around 9,000 jobs - around a tenth of its entire workforce - over the next three years, the BBC understands.

The announcement is expected to come next Tuesday as part of chief executive Antonio Horta-Osorio's strategic review of the business.

The three-year plan is also expected to include some branch closures.

The cuts are believed to be in response to the shift of many customers from physical branches to online banking.

More job losses would mark the continuing decline in headcount at the bank since its near-collapse and bailout in 2008 and 2009, at the height of the financial crisis.

Since then it has axed 30,000 jobs, and announced a further 15,000 job cuts as part of a three-year plan in 2011.

Branches to close

The government still holds a 25% stake in the bank, but has reduced its holding from about 39% through two separate share sales since September last year.

A reduction in branch numbers is also expected.

Lloyds has already divested itself of more than 630 branches through its flotation of the TSB business earlier this year.

It currently operates more than 2,000 branches across the country through its remaining Lloyds Bank, Bank of Scotland, and Halifax brands.

Lloyds made a commitment to maintain branch numbers as a condition of its takeover of HBOS in 2009, but that commitment expires at the end of this year.

Analysts say that will allow it to reduce branch numbers in response to the rapid growth of internet banking.

According to the banking trade body the BBA, digital banking transactions are now worth almost £1bn a day, with almost 40 million mobile and internet banking transactions every week.

Chief executive Antonio Horta-Osorio is expected to outline his latest plans for Lloyds on Tuesday, alongside the bank's latest financial results.

The bank has returned to profitability under his stewardship.

It posted its first annual profit since the financial crisis last year, although it has also been hit by Payment Protection mis-selling costs, and a multi-million pound settlement related to the Libor scandal.

Excluding those charges, it made an underlying profit of £3.8bn in the first six months of this year.

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