Lloyds to cut hundreds of IT jobs
Lloyds Banking Group is to axe hundreds of IT jobs in the latest round of a three-year programme of cuts.
The bailed-out lender will shed 228 roles in its Group IT division, as part of a wider cull of 640 jobs that will be removed from its retail and back office operations.
IT sites affected include London, Edinburgh, Bristol, Halifax, Copley and Manchester with additional impacts in Pusey, Leeds, Banbury and Birmingham.
Although the cuts represent the first announced job losses by a bank since last week’s Brexit decision, Lloyds said the reductions were unrelated and were part of its strategic review.
Unveiled in 2014, the review has already seen the 9% taxpayer-owned bank export droves of UK IT jobs to India, as part of the review’s aim to scale back the bank’s headcount by 9,000 by 2017.
About 200 Lloyds branches will have closed by next year too, to reflect both the increasing automation of roles and the switch that people are making from in-branch transactions to online.
But a second job cutting programme is not only likely; it also has the potential to be much more severe, believes Mark Brown, general secretary of the Lloyds Trade Union.
Alerting the bank’s techies to the 228 new cuts, he said: “We expect the bank will bring forward its next strategic review and a further round of job cuts and branch closures, on a scale we’ve not seen in the past.”
He explained: “The Brexit vote has driven a coach and horses through the bank’s strategic review and a period of lower interest rates, with some analysts predicting that interest rates will be at zero by the end of the year, is going to reduce income and profitability.
“Lower confidence and GDP growth will hurt credit cards, mortgages and personal loans all of which have been the sweet spots in the UK banking market.”
Brown told members that in a low interest rate environment, and without increased sales volumes (Lloyds’ Retail unit saw a flat performance in Q1), “the only lever the bank really controls is its cost base.”
His comments will raise the prospect among IT contractors that Lloyds may now follow in the footsteps of Morgan Stanley, Credit Suisse, Citigroup and Barclays, banks which all cut daily rates of IT pay this year.
Before Lloyds launched its strategic review, ContractorUK readers voted it ‘best client of the year’ in 2013, in joint-first place with Barclays, which unlike Lloyds went on to win a ‘best client of the year’ award the following year.
Meanwhile, another union spoke of the UK’s Brexit decision after condemning the bank’s job losses. “[The] government said last year it planned to sell off its remaining stake in Lloyds”, said Unite, which is being consulted about the cuts. “Chancellor George Osborne announced in January that he would pause these plans, citing market volatility. Following the UK’s decision to leave the EU, it is understood these plans will be shelved for even longer.”