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Lloyds to shut mortgage subsidiary, cut up to 1,660 jobs

  • Story Highlights
  • C&G is the smallest branch network of the combined Lloyds-HBOS group
  • Lloyds said it was removing overlap that exists in its extensive portfolio
  • Lloyds has cut almost 3,000 jobs since merger with Halifax Bank of Scotland
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LONDON, England (CNN) -- British banking group Lloyds TSB plans to cut up to 1,660 jobs and close all 164 branches of its Cheltenham & Gloucester (C&G) mortgage arm.

Cheltenham & Gloucester is a significant player in the UK mortgage market.

Cheltenham & Gloucester is a significant player in the UK mortgage market.

In a statement released Tuesday, the bank announced it was making a number of organizational changes following a careful and detailed review of its mortgage brands.

It said the Lloyds group will continue to operate a multi-brand mortgage business "whilst removing some of the overlap that exists in its extensive portfolio."

C&G is the smallest branch network of the combined Lloyds-HBOS group, which has some 3,000 branches, and its closure would remove it from the UK high street.

The closures, to take effect by November, will result in the loss of 833 full time jobs which will affect up to 928 full time and part time colleagues, the statement added.

The banking group's personal loans product team will move from Chester, northwest England to London by the end of 2011 and there will be a reduction in the number of people employed in this operation. It will also increase the size of its Black Horse direct sales operation whilst, at the same time, reducing the number of its Black Horse sales centres from 92 to 61.

The bank said these changes will affect up to 1,660 jobs.

Helen Weir, Group Executive Director, Retail, Lloyds Banking Group said: "Cheltenham & Gloucester is a very strong brand. The strategic focus for C&G from now on will be to further strengthen its intermediary and direct savings businesses. Another major priority for us is to ensure that we manage the closure of the C&G branch network so that it causes as little disruption as possible to our customers. We have a number of measures in place to achieve this.

"It is always difficult to make decisions about our business that affect our colleagues. We will work through these changes carefully and sensitively and continue to consult closely with our unions throughout the process."

The bank said C&G customers would continue to be able to manage their accounts at any of Lloyds TSB's 1,800 branches, over the phone and by post.

Lloyds has cut almost 3,000 jobs since mid-April after its merger earlier this year with Halifax Bank of Scotland (HBOS,) leading to anger from unions.

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According to the British Press Association, officials have complained about "death by a thousand cuts" and have urged the bank to "come clean" about the scale of the restructuring program.

On Monday British media reports said Lloyds would repay about £2.56 billion ($4.1 billion) of the "bailout" money it received from the UK government earlier this year, after raising £4.3 billion ($6.94 billion) by selling new shares.

All About Lloyds TSB Group plc

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