Irish Halifax network to go with loss of 750 jobs
Bank of Scotland (Ireland) yesterday announced plans to close down its 44 branch |Halifax network and other retail business in the Republic with the loss of 750 jobs.
Most of those affected will be laid off by |compulsory redundancy. BofSI employs 1,600 people in the Republic.
The bank, a unit of Lloyds Banking Group since its rescue takeover of HBOS in late 2008, had been carrying out a review of its operations since early last year.
Lloyds has pumped almost €3.5bn into BoSI since then, as loan losses on its estimated €12bn property and construction loan book spirals.
BoSI withdrew all Halifax retail products, such as mortgages, current accounts and |personal loans, and intermediary products, including mortgages, motor finance and commercial asset finance, to new customers from yesterday.
It will be writing to customers over the coming weeks to explain what steps they should take. It is anticipated that some €10bn of retail loans will be run down over time, even as the bank continues to honour the terms of existing loans.
The job losses will be drawn from 400 posts in the branch network, 220 from associated services in Dublin and 130 from a customer service centre in Dundalk.
Staff were informed in a conference call by chief executive John Higgins yesterday.
The Halifax business in Northern Ireland is not affected by the announcement.
Mr Higgins insisted the bank ‘remains very committed to its remaining 850 jobs and 12,000 business banking customers’, a legacy of its 2001 takeover of state-owned industrial lender ICC.
“It's a case of going back to the future,” |he said.
He added: “It is our greatest area of expertise and one which has a deep and developed customer base. To focus on this business is the right strategy for the company and all stakeholders.”
The small business loan book is estimated to stand at about €10bn.
Mr Higgins said the ‘sharp and sustained deterioration in the Irish economy’ as the retail operations were still in a start-up phase, meant that it could not achieve break-even or profit in a realistic timeframe.
He said that hitting this target was “dependent on a growing market and free availability of funding, both of which are now gone for foreseeable future.”