Virgin Money to Shut a Fifth of Branches as Lender Shifts Online
British bank Virgin Money UK Plc will close nearly 20% of its stores over the next few months as it focuses on investing in digital and mobile infrastructure.
The company said in a statement Thursday a review had identified 31 stores for closure after the pandemic shifted more business from branches to its website and mobile platforms. The move will result in an additional 25 million pound ($34 million) restructuring charge in the three months to September.
The lender will also book a further 20 million pound charge to repurpose its office space “to fit new ways of working,” and provide more flexibility around working patterns and location to “boost well-being and productivity.”
Other retail banks like Lloyds Banking Group Plc and HSBC Holdings Plc have also announced branch closures in the past year as traditional banks with costly real estate footprints and staffing needs come under increasing pressure from more online-focused banks like Monzo Bank Ltd or fintechs such as Revolut Ltd.
The changes mean Virgin’s restructuring charges for its financial year will now total about 145 million pounds. The lender’s shares fell 1% at 8:41 a.m. in London.
©2021 Bloomberg L.P.