Lloyds Banking criticised for stepping up job cuts despite return to profit

Lloyds Banking Group PLC (LON:LLOY) has cut 1,070 more staff despite returning to profit in the past quarter and possessing a bulging balance sheet.

Shares in Britain’s biggest lender fell 2% to 28.66p on Wednesday.

The cuts will mainly affect back office roles, with those made redundant today expected to leave in January at the earliest, a company spokeswoman said.

Trade union Unite, which represents many Lloyds staff, criticised the latest cuts and called on the FTSE 100 group to postpone its redundancy and restructuring programme with immediate effect as its recent results showed it was performing well in the face of the coronavirus pandemic.

The new job cuts come on top of more than 860 announced by Lloyds two months ago and another 780 axed in February before the bank put the programme on hold.

“Unite cannot comprehend why LBG would choose to cut 1,000 staff who have given the bank such commitment and dedication during a global pandemic,” said Rob MacGregor, Unite national officer.

With Lloyds having posted a GBP1.04bn pre-tax profit and raised its guidance for the full year, the union said this was a direct result of the hard work and versatility of its workforce.

“This cost cutting strategy will not serve the bank or its customers. It is impossible to reconcile the job losses announced today with such an improved balance sheet.”

Lloyds’ spokeswoman said the job cuts “reflect our ongoing plans to continue to meet our customers’ changing needs and make parts of our business simpler”.

She said the bank was separately creating around 340 roles.

Elsewhere on Wednesday, analysts at Bank of America Merrill Lynch upgraded their rating on Lloyds shares to ‘neutral’ from ‘underperform’, lifting the price target to 30p from 26p.