THE recent actions of a self-styled disrupter of the Scottish banking scene have proved it to be as tin-eared as incumbents that dominate the market.
HSBC has tried to win market share from the likes of Bank of Scotland and RBS in recent years by trumpeting its support for SMEs, and by extension communities across Scotland.
Last week however HSBC announced plans to close 20 per cent of its branches in Scotland in a move that will leave it with eight in the country.
READ MORE: Is more upheaval in prospect in Scottish banking sector?
The bank made the move at a time when a billboard advert looms over the country’s roads in which it claims to be at once global and local.
The sign has the words “Let’s build the new normal” with the last word scored through and the word “different” added next to it.
Beneath that it reads “We are not an island. We are part of something far, far bigger”. The words “Together we thrive” are included in smaller type looking like an after-thought near the bottom of the board.
Hip comedian Richard Ayoade fronts a TV advert that contains the same messages.
On its website London-based HSBC says it is helping businesses and people build their new different amid the uncertainties caused by the coronavirus crisis.
The bank highlights the help it provides for Children in Need and Shelter and how it is “standing against prejudice in all forms”.
READ MORE: Clydesdale Bank owner signals it may close more Scottish branches
But the bank has decided that a flagship branch on Edinburgh’s Princes Street will close on April 23 with Falkirk following on June 11.
The closures form part of a programme that will see 85 outlets closed across the UK, or 14% of the current total of 596.
The bank that proclaims the value of difference used arguments to justify the decision that were wearyingly familiar. The assumption seems to be that branches can be closed without any harm because fewer people are using them amid the unstoppable shift to digital.
Jackie Uhi, HSBC UK’s head of network, said: “The Covid-19 pandemic has emphasised the need for the changes that we are making.” Stripping out any impact of the pandemic, the number of customers using branches has fallen by a third in the last five years. Nine in ten of all customers contact the bank over the phone, internet or smartphone and staff talk with more than 100,000 customers a week on social media.
These things may be true but don’t mean the branches HSBC are closing have stopped serving a useful purpose for many people.
It is reckoned branch closures impact disproportionally on older people, some of whom may not be comfortable with digital technology. Many SMEs miss branches, especially those who operate in cash.
READ MORE: Departing RBS boss talks of customer service regret
HSBC said customers affected could find other branches not too far away or use the Post Office. The remaining branch network will be revamped to ensure it is relevant to today’s consumer.
But those alternative arrangements may not suit the customers concerned. The closures will leave more gaps on the country’s shopping streets at a time when the pandemic is hastening the closure of stores operated by firms that don’t have the financial muscle of banking giants.
The fact that the closures will hit Scotland harder than other part of the UK, in percentage terms, will raise fresh questions about HSBC’s commitment to the country.
At the end of 2018 the then HSBC Scotland chief executive Alison McGregor left the Glasgow-based post to pursue a portfolio of non-executive directorships.
The bank said Ms McGregor would not be replaced but insisted its appetite for growth in Scotland remained undiminished.
READ MORE: Numbers man says personal approach can pay off at Scottish Building Society
HSBC could have left its branches in place to serve customers that wanted to use them and to promote its brand. The investment would have helped set it apart following the swingeing cuts made to branch networks by RBS, Bank of Scotland and Clydesdale Bank in recent times.
Maybe HSBC thinks it has little to fear in terms of perceptions of brands.
RBS group closed many branches in Scotland after running a campaign in which it called itself “Royal Bank For Scotland”, then changed its name to NatWest. Remaining Clydesdale Bank branches are being rebranded as Virgin Money outlets. In November Bank of Scotland owner Lloyds was slated after reactivating plans to close 15 branches in Scotland that were paused earlier in the year amid the pandemic.
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