Britain’s high streets are reeling from the recent wave of bank branch closures with Virgin Money signalling more could be to come
Virgin Money has confirmed it will continue its focus on improving its online banking services after closing 39 bank branches.
The lender announced it will provide “greater cost-efficiency through digitisation” in its Q1 2024 financial results earlier today.
Virgin Money said it was on track to meet its target of saving £200million a year through restructuring.
So far, the bank has made 39 bank branch closures in the latest three-month period with a loss of around 150 full-time jobs.
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As a result of this decision, Virgin Money has slashed its total branch network by 30 per cent, leaving the business with only 91 physical locations.
The bank said it believes it has spent about £275million on restructuring costs, including improving IT systems, changing property spaces and cutting roles.
David Duffy, Virgin Money’s chief executive officer, said: “We’ve delivered growth in new accounts, deposits and target lending segments, at stable margins and with ongoing cost efficiencies.
“We are encouraged by both our customers’ resilience and improving sentiment in the mortgage market as interest rates have peaked. We carry good momentum into 2024 as we continue to successfully execute our strategy.”
More than 5,828 bank and building society branches have closed since January 2015, according to Which?.
Concerns have been raised over whether communities will have sufficient access to cash services with the Financial Conduct Authority (FCA) set to get more powers to assess the necessity of closures.
Aside from its restructuring plans, Virgin Money reported a 2.2 per cent decline in mortgage lending to £57.1billion in the three months to December, down from £58.4billion in the same period a year earlier.
According to the lender, this fall was indicative of a more disciplined approach to lender amid a “subdued” market.
Despite this development, Virgin Money cited early signs of improvement in the housing market last month. This was reflected with residential and buy-to-let mortgage applications being in line with 2019 levels before the Covid-19 pandemic.
In its predictions for the future, the bank forecast lower mortgage rates will give consumer sentiment a boost considering interest rates have likely “peaked”. Over the period, provisions for bad loans increased to almost £640million from £617million in the last quarter more households struggled to make mortgage repayments.
Here is a breakdown of the 39 bank branches that were shut down by Virgin Money in 2023: