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Lloyds to axe 20% offices as it moves to 'flexible working'

·Senior City Correspondent, Yahoo Finance UK
·3-min read
Lloyds banking group offices in Gresham Street in London. Photo: Philip Toscano/PA Images via Getty Images
Lloyds banking group offices in Gresham Street in London. Photo: Philip Toscano/PA Images via Getty Images

Lloyds Bank (LLOY.L) plans to reduce its office space by a fifth as part of a push towards flexible working.

Lloyds said in its annual results statement on Wednesday that it planned to shut 20% of its office space by 2023. The move has been prompted by COVID-19, which the bank thinks will permanently change the way staff work.

The majority of Lloyds' 60,000 staff moved to working from home last year as the pandemic struck. Chief financial officer William Chalmers said a recent survey of employees found 77% wanted to work from home at least three days a week even after the pandemic subsides.

READ MORE: Lloyds Bank profit crashes 70% due to COVID but dividend returns

The finding has prompted Lloyds to consider cutting back office space and rethink the space that remains. Chalmers said the bank would "ensure that the workspace is fit for purpose in an environment in which colleagues want to come to work to collaborate rather than necessarily sit at their desks on their own".

“We will create a purposeful and future-ready workspace for all," he told journalists on a call.

Lloyds is the second major bank to announce an overhaul of its office footprint in as many days. HSBC (HSBA.L) said on Tuesday it would look to cut 40% of its office space in the coming years as part of a cost saving drive.

Lloyds chief executive Antonio Horta-Osorio said the ability to work from home would depend on staffs' roles at the bank.

READ MORE: HSBC plans to slash office space post-COVID

"For example, somebody working in the accounting department can by definition work more time from home than a colleague that is in a branch serving customers," he said.

Horta-Osorio said staff would not be forced to work from home if they didn't want to.

"If you live in a house where you can have space to work, you probably would like to be more flexible in terms of working than if you live in conditions with a bigger family or many people at the house and its difficult to work in normal circumstances," he said.

"We want to make a match between the bank's needs, depending on the function as I said, and the people's individual preferences."

READ MORE: Barclays CEO: Packed Canary Wharf offices 'may be a thing of the past'

The COVID-19 pandemic has prompted a seismic shift in the way the world works and companies are considering which aspects to keep when life begins to normalise. Horta-Osorio said he believes having a flexible approach to work locations would be "critical" in attracting top talent in future.

"I think this will be critical going forward in the way people choose who to work for," he said.WAT

WATCH: Work from home: what UK businesses are planning post-lockdown

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