2) Branch Closures - monitoring our impact on the local community

[ Existing Commitment ]
The Co-operative Bank prides itself on being at the forefront of those using the latest technology to deliver high quality, 'anytime anywhere' banking. However, the shift to the remote delivery of banking services, combined with other trends, has resulted in a number of our local branches becoming poorly utilised, warranting closure. The Bank's Mission Statement commits it to being "a responsible member of society by promoting an environment where the needs of local communities can be met now and in the future". Therefore, since we understand that the closure of a branch can have an impact on customers and the community as a whole, we have commissioned research in order to try to measure this.

[ Performance ]
During 1997 a total of seven personal branches were closed (Basingstoke, Bedford, Burton, Chepstow, Dudley, Weymouth and Ystrad Mynach), affecting approximately 35,000 customer accounts. In order to assess the impact of this, we commissioned research to ascertain reactions to these closures from a sample of customers who lived in the vicinity of these branches at the time of closure.

The results of the research indicate that for a significant number of customers (44%) the decision to close the branch has had little or no effect on their opinions of the Bank.

However, 6% of those contacted expressed concern about potential job losses amongst branch staff and 40% felt that the decision had produced a negative impact on the local town centre or the community at large. General inconvenience was, not surprisingly, the most frequent reason for saying the local town centre had been affected. But people also felt the closure had a negative effect on local jobs and hence the economy, or that there had been a physical scar left by the presence of an empty building. Effects on the local community were similar, with 11% feeling local jobs and the economy had been adversely affected. 10% also said that the branch closure gave The Co-operative Bank a bad image.

[ Comment ]
Customers living close to branches that had been closed had two principal concerns about our decision; one for the local community, and one for staff employed at the branch.

Despite job losses being an area of concern, as reported in the section on "Staff", the Bank and its trades union BIFU do not anticipate the need for compulsory redundancies anywhere in the Bank before the year 2000. Furthermore, the Bank has a number of initiatives in place which aim to ensure that the local long-term unemployed are given special consideration when job vacancies come about, such as happened in Stockport recently when we opened a new Telephone Banking Centre. During 1998 we will also become involved in the Government's 'New Deal Initiative', which seeks to help those aged 18-24 and unemployed for six months or more.

Although we have closed a number of branches during the last twelve months, towards the end of 1997 the Bank came to an agreement with Post Office Counters Ltd which allows all our personal customers to use 15,500 post offices in England and Wales for routine transactions (see "Customers" for further details). This gives our customers the option to use services such as telephone banking, as well as the opportunity of supporting local service providers such as the Post Office.

[ Future objective ]
Where office closure or relocation is required, the Bank will continue to be mindful of the impact on local communities.

MERVYN PEDELTY Chief Executive