Lloyds Banking Group is accelerating its cost-cutting drive by announcing more job cuts and branch closures despite doubling its profit in the first half of 2016.
The UK high street bank made £2.5bn pre-tax profit, up from £1.2bn for the same period in 2015, however much of this was down to the fact that the bank was not forced to set aside cash to cover penalties for PPI mis-selling.
Instead the bank is planning to cut 3,000 jobs and close 200 branches in order to save an extra £400m by the end of 2017 as a result of the recent Brexit vote and a likely slump in customer activity.
"Following the EU referendum, the outlook for the UK economy is uncertain and, while the precise impact is dependent upon a number of factors, including EU negotiations and political and economic events, a deceleration of growth seems likely," said Lloyds chief executive António Horta-Osório.
Lloyds announced a major cost-cutting exercise in 2014 with a plan to save £1bn by the end of 2017 by cutting 9,000 jobs and closing 200 branches. The bank then also forewarned of further changes in June when it suggested that 23 branches and 640 jobs would be cut.
The decision to increase the amount of branch closures and job cuts is also a result of changing customer behaviour, said Horta-Osório. The number of branch transactions continues to drop and has accelerated from 8% to 15% in recent years. In addition Lloyds has continued to invest heavily in its digital banking offering, which it claims is now the biggest in the UK with more than 12 million online users.