Northern Rock to axe 250 jobs with branch closures
Tuesday 16 November 1999
The bank also announced plans to expand its Internet and phone operations by taking on another 400 staff in the North-east of England and open a savings operation in Ireland.
Adam Applegarth, an executive director of the bank, said that the changes are in response to the shift in demand from customers away from the traditional branch towards post, telephone and the Internet.
"The way customers want to do business is changing. Over 60 per cent of our mortgage applications start with a telephone call to our mortgage direct operation. Ten years ago that would not be the case. We are closing the branches because people are simply not using them," he said.
He added that the share buyback, the first by Northern Rock, reflects a desire to move to a more efficient capital structure. The group had its first successful mortgage-backed securitisation issue worth pounds 600m in October and plans a further tranche of mortgage backed bonds next year.
Further details of the buyback will be announced at the time of the 1999 results on 26 January next year. The bank also announced that it is in advanced negotiations about the sale of its interest in Regency Care Homes to NHP. "This is not a change of strategy it is how to enhance the strategy we have already articulated," Mr Applegarth said. "Being small is not always and advantage but at least in this case we have been able to move quickly in response to changes in the marketplace."
Yesterday's announcements were warmly welcomed in the City. Northern Rock has fallen badly out of favour because of concern about the impact of new competitors on its core business.
The bank said yesterday that the second half of the year was going well. The outflow of savings that reached pounds 400m in the first half had slowed since Egg, the Prudential's direct banking arm, went internet only, and mortgage applications are running at 85 per cent of the levels of the second half of last year.
- 1 BBC election debate: The one photo that summed up the whole 90-minute leaders debate
- 2 A bottle of wine a day is not bad for you and abstaining is worse than drinking, scientist claims
- 3 18th century sex toy found in 'toilet of sword fighting school' in Poland
- 4 'I wish my teacher knew...': Young students share their 'heartbreaking' worries in notes
General Election 2015: David Cameron catching up in polls – but he badly needs a clear lead
The Hubble Space Telescope's amazing journey 25 years on
South Africa xenophobic attacks: Shops looted and violence on streets of Johannesburg as foreigners are forced to hide in police stations
Earthworms rain down from skies over Norway, puzzling scientists
18th century sex toy found in 'toilet of sword fighting school' in Poland
The only black face in the Ukip manifesto is on the page about overseas aid
Ukip is the only main political party to not address LGBT rights in its manifesto
If I’m being racially abused I don’t need a white stranger with a saviour complex to rescue me
BBC election debate: The one photo that summed up the whole 90-minute leaders debate
Religion isn't growing, it is becoming vigorous in its demise, says philosopher AC Grayling
Russian warships in English Channel 'to conduct anti-aircraft and anti-submarine military drills'
iJobs Money & Business
£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...
£50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...
£13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...
£40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...