Scotiabank (TSX:BNS) has announced a 3 per cent staffing cut that will result in widespread branch closures, notably affecting rural communities such as Grand Bank, Bonavista, Twillingate, Whitbourne, and Burgeo. The closures are expected to be implemented post-August next year, leaving customers with over an hour's travel for banking services.
The closure of the Bonavista branch, the region's only Scotiabank outlet, is set for September 2024. This move comes after nearly 100 years of operation and is part of the bank's shift towards online banking. Consequently, in-person services will be relocated to Clarenville, a 90-minute drive away. The decision has sparked criticism from Mayor John Norman who expressed concern for thousands left without service, particularly seniors and businesses that rely on in-person transactions.
In light of these developments, large business accounts have begun withdrawing from Scotiabank. Other financial institutions have also shown interest in the area. Alternatives available to residents include a credit union in Port Union and an RBC (TSX:RY) branch in Port Rexton.
The impact of these closures has raised concern among local leaders. Grand Bank Mayor Rex Matthews demanded accountability from Scotiabank for the economic ramifications of the closures. Bonavista Mayor John Norman, after recently completing a speaking tour on Bonavista’s economic development, voiced concerns about the potential negative impact on business growth and corporate deposits.
Deatra Walsh from Municipalities Newfoundland and Labrador anticipates that the branch closures will be a key discussion point at the MNL’s AGM and Conference where Federal Minister of Rural Economic Development Gudie Hutchings will be present. The issue is also set to feature prominently at a Premier’s Forum.
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