Santander UK to axe a fifth of branches, around 750 jobs at risk

By Sinead Cruise, Andres Gonzalez

LONDON (Reuters) -The UK arm of Spain's Banco Santander said on Wednesday around 750 staff could lose their jobs under plans to close a fifth of its branch network, raising fresh questions about the scale of the lender's UK presence.

Santander UK, which has recently been the subject of speculation about its future ownership, will close 95 of its 444 branches from June, it said in a statement.

The lender will continue to operate 349 outlets, including 290 full-service branches and 36 reduced-hours branches.

Like other banks across Britain, Santander has steadily reduced its branch network to save costs as more customers switch to digital banking.

Santander said it had seen a 63% increase in digital transactions since 2019, with financial transactions completed in branches down 61% in the same period.

But some UK lawmakers have criticised lenders for widespread closures, saying they made it tougher for local businesses and that vulnerable customers in rural areas were struggling to access their money.

Last September, the Financial Conduct Authority introduced new rules to make it harder for banks to shut branches without ensuring communities have free access to an alternative provider of cash.

"As a business, we must move with customers and balance our investment across all the places where we interact with customers, to deliver the very best for them now and in the future," Santander UK said.

"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 minimise the impact it may have on our customers."

Santander said it was consulting employee unions on the changes and would provide support to staff affected, including assistance in finding alternative jobs in the bank.

Santander UK, which posted a 38% fall in annual pretax profit to 1.33 billion pounds ($1.73 billion) in 2024, employs around 18,000 people, according to the bank's annual report.

Banco Santander said last month its UK unit remained a core part of its globally diversified business model and the division was not for sale, after media reports suggested it was reviewing its presence in Britain.

Reuters in January cited sources familiar with the matter as saying that Barclays had approached Santander about a possible offer but the talks ended at a preliminary stage.

($1 = 0.7708 pounds)

(Reporting By Sinead Cruise and Andres Gonzalez; Editing by Amanda Cooper and Mark Potter)