Main Menu

End of a banking era

Bank crisis: Airdrie to close, Clydesdale to shut branches

Airdrie BankScotland was hit with a double banking blow today as Airdrie Savings Bank announced it was to close and Clydesdale plans widespread cuts.

Airdrie is to close after failing to cope with the added costs of regulation following the banking crisis.

Staff were summoned to a meeting by bosses today and told all 70 jobs are likely to go at the North Lanarkshire-based bank.

They heard the news as the Unite union said Clydesdale Bank is planning to close about a third of its bank branches and fire more than 400 employees to reduce costs.

The Glasgow-based lender is planning to shut 79 branches, the largest closure programme in its history, the union said.

“Unite is clear that the closure of a third of the bank’s branches will not only be concerning for staff but the local communities which will see their bank branch close,” Unite said in a statement.

Clydesdale said the number of customers using branches for transactions have fallen by a third since 2011, while the number of people making digital transactions has increased.

Gavin Opperman, Clydesdale’s customer banking director, said the changing use of technology means fewer staff and locations are needed.

“The changes announced today continue our journey towards a model that combines an enhanced digital platform with a right sized branch network,” he said.

Airdrie’s board is planing to wind up the 182-year-old business and close all 40,000 accounts by April.

Chief executive Rod Ashley said compulsory redundancies could not be ruled out.

The bank’s loan book will be transferred to TSB Bank with the rest of the business to be wound up by autumn time this year.

Mr Ashley said: “In taking this difficult decision, the trustees have taken full account of the bank’s proud history.

“However, we are in absolutely no doubt that acting now from a position of financial strength is both prudent and responsible, and in the best future interests of our customers.”

Mr Ashley cited a “shrinking customer base” and “declining footfall” as contributing to the closure.

He said: “Sad as the course of action outlined today is – in terms of our history and heritage – we are in absolutely no doubt it is in the best future interests of our customers.”

In May 2015, the bank announced branches at Baillieston, Muirhead, Motherwell and Shotts would close. Its Falkirk branch, the first outside its core area, shut its doors in April last year.

The bank operates on mutual principles, has no shareholders and is governed by a board of trustees.

Airdrie Savings Bank was days away from marking its 182nd anniversary on 21 January.

Airdrie Savings Bank Souter

In the aftermath of the financial crisis it received support from a number of high profile Scottish business leaders including Brian Souter (above) and Sir David Murray who supported it as the ‘ideal’ bank based on traditional values. 

Unite the union regional officer Wendy Dunsmore said: “This announcement is a bitter disappointment and will come as a shock to many.

“Unite will be doing everything we can to support our Airdrie Savings Bank members during this incredibly sad and difficult time, and to make sure their employment rights are protected.  

“Our understanding is that the bank has had to meet extra costs due to increased regulation following the financial crash of 2008. So Airdrie Savings Bank has become yet another innocent victim of casino bankers.

“Even at this late stage, we would urge the Scottish and UK Governments and the banking regulators to work with us to explore all options for saving jobs.

“One of Unite’s first steps will be to talk to the Scottish Government’s Financial Services Taskforce which was set up during the banking crash to help redundant workers back into employment.”

Unite said the closure of Airdrie Savings Bank is part of a wider crisis in the banking sector in Scotland.

Unite Scottish secretary Pat Rafferty said: “Since 2008, Scotland has lost 19,000 jobs in finance and insurance. That is a catastrophe.

“The Scottish and UK Governments need to help us support employment in the banking sector, and urgently look at ways to make sure that communities across Scotland have access to local banking.”

Alex Neil
Alex Neil

Airdrie and Shotts MSP Alex Neil revealed that talks had taken place with regulators over the past few months to save the bank to no avail.

He said: “After the financial crash of 2008 it was probably for a while one of the few viable banks left in Britain. 

“However the consequences of the financial crash have meant that it has become impossible for such a small bank as the ASB to survive, especially given the very tight regulatory regime that now exists for banks in Britain.

“Up to 70 people will lose their jobs over the next few months and I, along with Neil Gray MP, will be doing all I can to ensure that every possible effort is made to help these good people find alternative employment.

“It should be stressed that nobody’s money is at risk. All those with savings with the ASB will get back every penny that they have in the bank.

“This is the end of an era. All those people, past and present, who made the ASB the success it was should be proud of themselves.

“Events out with their control have led to this sad decision, but the bank’s long and proud history should never be forgotten.”



Leave a Reply

Your email address will not be published. Required fields are marked as *

This site uses Akismet to reduce spam. Learn how your comment data is processed.