More branch closures likely across Malaga as banks rethink plans and cut costs

Banks in Spain had already closed thousands of branches.
Banks in Spain had already closed thousands of branches. / SUR. ARCHIVE
  • There used to be more than 1,400 bank branches in the province but in the past ten years the number has been reduced to 721, according to the Bank of Spain

During the lockdown, many people started using online banking for the first time. This was good news for the banks, which had been encouraging this 'digital conversion' for some time: the pandemic achieved in a few months what would otherwise have taken years. However, there is another side to this coin: many branches are likely to close.

All the banks have had to rethink their plans this year, due to the harsh reality of the pandemic. They have earned much less than expected or have even made losses as the financial hit starts to take effect.

When things are this bad, those who run the banks are obsessed with cutting costs, and there are three main ways the sector does this: mergers, closing branches and reducing staff levels. Iñigo Vicente of COMFIA, the CC OO union's Federation of Financial and Administrative Services, says we are facing a double whammy: "There is going to be a new wave of restructuring, with mergers which will mean fewer staff, and the banks themselves are also going to close branches".

During lockdown, they all closed some branches temporarily to reduce their employees' exposure to Covid-19. These have now reopened, but with fewer staff as many are still working from home. "They realised that staff working from home could handle many of the services provided by branches. They want fewer offices, and to focus on selling products and advice," says Vicente.

More branch closures likely across Malaga as banks rethink plans and cut costs

The bank with the highest number of branches in Malaga province (180), Unicaja Banco, says it is continuing a "process of transformation" which began some time ago. It won't say which branches are to close, as the situation is under constant review, but says the alternatives to traditional banking include an extensive network of ATMs and online banking. Bankia had already planned to close 140 branches in Spain by July, even without the pandemic. CaixaBank was already planning to reduce its branches in Spain from 4,219 'sucursales' to 3,640 by the end of this year, and in February BBVA announced the closure of 160 branches this year.

The unions seem to have accepted that branch closures are inevitable, but are concerned about the consequences for staff. "We want regulations about conditions for working from home and guarantees that transfers are justified," says Vicente. However, they are not expecting massive job losses, such as those which took place in the past.