Inquiry quizzes RBS chief on branch closures

Inveraray businesses protest after the announcement of the closure in December last year.

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A petition to halt the closure of Castlebay and Inveraray’s Royal Bank of Scotland branches has been presented to the House of Commons, as the bank’s chief executive officer explains the decision to an inquiry of MPs.

RBS announced the closure of 62 branches across Scotland in December last year, citing changes in the way customers access banking services for a drop in branch use of around 40 per cent in the last three years.

In February 2018, it announced 10 of these branches, including  Castlebay and Inveraray, would be kept open until the end of the year, and their closure reviewed if there was a significant increase in transactions.

Thanking the hundreds who signed the petition to keep Barra’s branch open, Isles MP Angus Brendan MacNeil MP said: ‘RBS is 72 per cent owned by the taxpayer and it is only right the UK Government is aware of the enormous impact bank closures and reduced hours will have on island communities.

‘The actions of RBS are particularly galling with the recent news that the bank has announced a threefold increase in profits for the first quarter.’

Presenting his petition against closing Inveraray’s RBS branch, Argyll MP Brendan O’Hara said: ‘Ten years ago the people of this community along with other UK taxpayers bailed out RBS to the tune of £50 billion and now, without consultation, it has decided this branch may close.

‘A stay of execution has been given but the threat of closure is still very real. The people of this town are rightly outraged at this decision, leaving them with no bank, and the several hundred people who signed the petition only serves to show the strength of feeling.’

The Unite union has also called for a moratorium on RBS’s closures following a ‘trebling’ of its profits. A spokesperson said: ‘RBS reported a profit of £792m for the first three months of 2018. This is up from £259m for the same quarter last year. So in 2018, RBS seems set to treble its profits.

Mary Alexander, Deputy Scottish Secretary of Unite, said: ‘RBS is rolling in profits. It’s time for the bank to call a moratorium on the axe hanging over 62 branches in Scotland. This is now a totally different situation profit-wise to when the plans were made to close one in three branches.’

At the Scottish Affairs Select Committee hearing in Westminster in January, RBS directors told MPs it would save £9.5m a year after closing the 62 branches.

The committee quizzed RBS chief executive officer Ross McEwan on Tuesday May 8 to ‘examine the reasons behind the decision to close 62 branches of RBS in Scotland, subsequent temporary reprieve for ten branches and the long term future of local banking in Scotland’.

The session also examined the impact of the planned closures on the communities they serve and the effectiveness of replacement services offered by RBS, such as mobile branches. It will also consider RBS’s obligations to its customers given the UK government’s position as majority shareholder.

Committee chairman Pete Wishart MP said: ‘RBS is a company that is still owned by the taxpayer and we still have many questions about the decision making process that will lead to so many communities in Scotland being left without vital banking services. We also want more details on the branches that have been given a reprieve – on what basis will they be judged viable in the long term and why wasn’t this opportunity afforded to all affected branches.’