Lloyds Banking Group plc (LYG), the leading UK-based retail lender, will trim its work-force and close several branches in order to implement a digital strategy to computerize operations and save costs. The bank will reveal details of the digital strategy, which is part of a three-year plan, on Oct 28, along with its third-quarter results.
Quoting people familiar with the matter, sources cited that Lloyds plans to slash thousands of jobs, probably in areas such as mortgage processing, new account opening and call centers. However, some employees may be offered alternative positions.
After a government bailout during the 2008 financial crisis, Lloyds has been economizing by eliminating jobs and streamlining operations. With 25% of its ownership still remaining with the British government, the bank looks forward to capitalize on modern technology to attract tech-savvy customers, who prefer online banking and mobile applications to the manual process.
Also, Lloyds’ step to modernize the whole business will assist it in attaining smoother operations, improved customer service and cost advantage. This will lead to higher profitability, which in turn will put the bank on track to achieve full private ownership by regaining the stake with the government.
Among other foreign banks, Barclays PLC (BCS), HSBC Holdings plc (HSBC) and The Royal Bank of Scotland Group plc (RBS) have also either been slashing jobs or restructuring businesses to boost profitability.
Currently, Lloyds carries a Zacks Rank #3 (Hold).
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