The cull goes on

By JUSTIN HARPER FOR MAILONLINE
Updated: 19:00 EST, 31 May 2002

HIGH Street banks continued to close branches last year, despite promises that the culling programmes were to end.

Research obtained by Money Mail shows that more than 150 branches were closed in 2001, most of them by the traditional banks. And the closures are continuing this year as residents of a small town in Wiltshire, who rely on a Portman Building Society branch, have just learned.

Pewsey, which is in the very heart of Portman's membership area, has a population of more than 4,000, many of whom are in shock that what they say is a well-used branch is to shut its doors.

The banks have largely abandoned the mass closure programmes that attracted attention in 2000, and have instead adopted a low-profile, branch-by-branch approach. Lloyds TSB closed 74 of its 2,013 branches, Barclays closed 35, Halifax 22, HSBC 19 and Bradford & Bingley 11, according to the British Bankers' Association. NatWest retained the same number of branches - though its parent Royal Bank of Scotland closed four.

Rural communities from the north of Scotland to the south of England have been undermined by hundreds of bank branch closures in recent years.

The closures have spelt disaster for small businesses and meant hardship for residents, who have often had to travel many miles to their nearest branch. On one day - 7 April, 2000 - Barclays closed 171 branches.

Lloyds TSB has closed 729 branches since its merger in 1996 and Royal Bank of Scotland/NatWest 1,313 during the last 11 years. However, closure programmes were halted after a public outcry.

Until now, building societies have remained aloof from closures, emphasising that their closer community links mean the profit motive does not always come first. But Portman Building Society told Pewsey residents at the weekend that their local branch is to close.

A spokesman for the society, whose motto is 'Mutuality - It's in your interest', says: 'Unfortunately, branches have to be considered for closure where the membership support declines. The financial cost of maintaining a service where the local community support is dwindling is one of the main factors taken into consideration.'

Derek French, a spokesman for the Campaign for Community Banking Services, says: 'It's a real shame that a building society is backing out of an area it has regional strength in. Portman is really nailing its colours to the mast and saying it's all right for mutuals to behave in this way.'

Caroline Dalrymple, who owns an interior design business in Pewsey, says: 'We are a poor village and this will massively increase our struggle to keep going.'

Pewsey Parish Council chairman Colin Lampard says: 'I feel betrayed by Portman and this is another nail in the rural community's coffin. The branch is always busy, so this announcement comes right out of the blue.'

Villagers have been told the branch is to close in August. The nearest Portman branch is about seven miles away in Marlborough. Mr Lampard adds: 'The only branch that will be left will be a Lloyds TSB, which severely restricts villagers' choice.'

Portman, the UK's fourth largest building society, has a further 113 branches. Its chief executive Robert Sharpe says there are no plans to close further branches. He adds: 'We have seen a steady decline of usage and in the number of transactions over the last five years at Pewsey. It does have its busy moments, but also many quiet afternoons.' He refused to reveal the actual transaction figures, claiming they were ' commercially sensitive'.

Portman argues it is actually increasing its branch network, having opened an outlet in Watford and with plans for three more in Woking, Slough and Sevenoaks. But these are hardly small rural communities which depend upon their local building society for basic facilities.