Nationwide to step up dig­i­tal in­vest­ment as branches stay

Lender ex­pects to cre­ate new jobs at ‘tech­nol­ogy hub’ Will take charge of up to £250m in cur­rent fis­cal year

The Scotsman - - Business - By SCOTT REID

Nationwide Build­ing So­ci­ety is to main­tain its branch net­work af­ter un­veil­ing plans to pump an ad­di­tional £1.3 bil­lion into new tech­nol­ogy in a move than, over time, should cre­ate hun­dreds of jobs.

The ex­tra cash will bring the group’s to­tal tech in­vest­ment plans to £4.1bn over the next five years, dur­ing which it ex­pects to cre­ate be­tween 750 and 1,000 jobs in a new “tech­nol­ogy hub”.

In a doc­u­ment en­ti­tled “Re­defin­ing Ser­vice for a Dig­i­tal World”, the Nationwide said it will help “sim­plify its tech­nol­ogy es­tate and build new tech­nol­ogy plat­forms to en­able growth and di­ver­si­fi­ca­tion, and drive for­ward dig­i­tal, data and an­a­lytic strate­gies”.

How­ever, it in­sisted that there were no plans for re­dun­dan­cies in other parts of the business and pro­vided as­sur­ances that its branch net­work will be main­tained.

The fresh in­vest­ment will still come at a cost, with the group now ex­pect­ing to take a £200 mil­lion to £250m hit in the cur­rent fi­nan­cial year, around half of which will be recog­nised in the first half. That an­nual cost will be re­peated over the next five years.

Joe Gar­ner, chief ex­ec­u­tive of the Nationwide, which took over the prof­itable core of the Dun­fermline Build­ing So­ci­ety in 2009 when the lat­ter was laid low by risky prop­erty deals, said: “Nationwide is in a po­si­tion of fi­nan­cial strength with cap­i­tal lev­els at an all­time high.

“At a time when cus­tomer ex­pec­ta­tions of ser­vice are rapidly chang­ing in a dig­i­tal world, we are in­vest­ing to en­sure that we con­tinue to pro­vide lead­ing ser­vice.

“We be­lieve that our mem­bers want a com­bi­na­tion of hu­man ser­vice on the high street, as well as dig­i­tal con­ve­nience. As a build­ing so­ci­ety, we are able to de­liver both – con­tin­u­ing to invest in our branches along­side this sig­nif­i­cant in­vest­ment in our tech­nol­ogy and op­er­a­tional ca­pa­bil­i­ties.

“As part of this over­all in­vest­ment, we an­tic­i­pate cre­at­ing an ad­di­tional tech­nol­ogy hub in the UK and em­ploy­ing be­tween 750 and 1,000 peo­ple over time.”

The five-year in­vest­ment plan is aim­ing for “sus­tain­able” cost sav­ings of £500m by 2023, which ex­tends its pre­vi­ous tar­get by a fur­ther £200m.

Last month, Bri­tain’s biggest build­ing so­ci­ety warned of a “sub­dued” UK hous­ing mar­ket in the months ahead with lit­tle growth in prices af­ter post­ing a fall in prof­its. It said peo­ple were “adapt­ing their be­hav­iours” in re­sponse to a squeeze on dis­pos­able in­comes.

The lender said statu­tory pre-tax prof­its fell to £281m in the three months to 30 June, from £322m over the same pe­riod last year. How­ever, it noted that it was up against tough com­par­a­tive fig­ures, with last year’s num­bers boosted by its £26m Vo­calink dis­posal.

sreid@scots­man.com

Tim Martin founded the pub business in the late 1970s

Newspapers in English

Newspapers from UK

© PressReader. All rights reserved.