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Daily Digit: Banks shutting European branches

Monday, August 12, 2013 - 01:33

Aug. 12 - Banks have shut around 20,000 branches across Europe in the last four years, according to a Reuters analysis of European Central Bank data, and the cull is expected to last for many more years. As Joanna Partridge reports, banks are trying to improve efficiency, and mobile and internet banking is accelerating the shift away from a traditional banking model.

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20,000 is today's daily digit in Europe. It's the number of bank branches which have shut across the region in the last four years. That's according to a Reuters analysis of European Central Bank data and represents the closure of around 8% of Europe's branches since the financial crisis. The cuts have been most severe in Spain - putting an end to years of expansion by regional savings banks which left the country with the largest network in Europe. A condition of last year's European bailout of Spain's weak lenders, including Bankia, was that they would keep shrinking. The cull of branches is expected to continue for many years, with France seen as ripe for cuts. Shutting branches is one way for lenders to cut costs and become more efficient, says Jane Foley from Rabobank. SOUNDBITE: Jane Foley, Rabobank, saying (English): "This isn't just about banks doing a wholesale cost-cutting because of the financial crisis, you can certainly present a case to say that even if these banks were very, very healthy, even if there hadn't been a crisis, there could be a tendency to reduce branches too, because people are using more electronic banking too." But the closure of so thousands of branches risks leaving some clients without easy access to banking. And some lenders say fear of a backlash from customers, or politicians, has stopped them from shutting shop as quickly as they should, especially in countries like Britain, where some of the biggest lenders were rescued by the taxpayer.

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Daily Digit: Banks shutting European branches

Monday, August 12, 2013 - 01:33