Job cuts at Nationwide
26 May 2010, 10:52
The UK's biggest building society has warned that further staff could go as the amount of money they made fell by 46% last year.
Pre-tax profits were down to £212 million, from £393 million a year earlier, with Nationwide pointing to continued low interest rates as being one of the main factors.
The company said it was taking tough action on costs to help limit profit declines, including possible cuts in its administration centre network and possible branch cuts as it looks to shrink the business following a series of takeovers and amid tough conditions for mortgages and savings.
Nationwide employs around 4,400 people across the Swindon area.
It is working on plans to reduce branch and retail distribution outlets - currently totalling more than 1,000 - and trim a 20-strong network of back office and administration centres. The group axed around 800 jobs last year and closed 12 branches, but braced the mutual for more substantial reductions amid its 15,800 workforce over the next few years, although it said it was too early to give locations of any cutbacks or numbers.
Nationwide said this was partly due to duplication following deals over the past few years, with Nationwide having grown substantially following mergers with the Derbyshire and Cheshire building societies and the takeover of ailing Dunfermline's savings assets last March.
It blamed stiff competition for customer deposits from banks and Government-backed businesses for a large drop in savings, but said it had begun to stem the flow in the second half of the year. The group said Government belt-tightening and potential tax hikes could heap further pressure on profits.