NAB restructures UK banking operations
The National Australia Bank (NAB) has restructured its United Kingdom banking operations, with NAB chief executive Cameron Clyne declaring that economic recovery in Europe now needs to be considered in a longer-term prospect.
The big banking group has acknowledged that the changes to its UK banking operations will result in job losses.
Announcing the restructuring to the Australian Securities Exchange (ASX) today, the bank's announcement said that not only did the region now look to be a longer-term prospect in terms of recovery, but that "credit quality and an increase in the cost of funding following the downgrades to Clydesdale Bank's credit rating have combined to reverse the recovery in UK banking's financial performance".
Clyne said the action NAB was taking was needed to adapt to the current economic environment in the UK and to reposition the UK banking business to improve returns for the Group over the medium term.
"These changes will refocus UK banking on its retail and SME-oriented franchise in Scotland and Northern England, while substantially reducing costs, improving the balance sheet structure of UK Banking and reducing the risk appetite for business banking in the UK," he said.
At the core of the NAB's changes to its UK Banking operation is a consolidation of its retail operations and SME business lending in Scotland and Northern England and a significant reduction in the number of the Financial Solution Centers it runs.
Clyne said that while every effort would be made to support the bank's staff in the UK, "the substantive repositioning of the business will impact its role in the UK".
He said the "employee consultation process" would begin shortly.
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