Lloyds TSB is closing its customer contact centre in Newcastle, leading to the loss of 986 UK jobs, and is transferring the work to its operations in India.
Lloyds TSB, which is Britain's fifth-largest bank, will close its Newcastle call centre by the end of 2004. The bank insists it will shift the work to its other UK centres as well as to its new centre in India.
In a statement, Lloyds TSB says: "We operate in a fiercely competitive environment and it is vital that we find ways of running our business effectively and competitively."
The bank said in September it would have 1500 jobs in India by the end of 2004 to reduce costs. The closing of the Newcastle centre is part of that plan. Lloydds TSB, which set up a pilot programme in Bangalore last year, already employs 250 staff in India to deal with card collection processing.
Unions have reacted furoiusly to the plans and haven't ruled out strike action. Bernadette Fisher, national officer for Unifi, told the BBC: "This is a callous move by Lloyds TSB, jumping on the outsourcing overseas bandwagon accelerated by HSBC earlier this month, and shows that despite all Lloyds' statements on social responsibility it has no respect for staff, customers or local communities."
According to press reports the UK's Barclays Bank is also considering outsourcing 350 jobs from its back office processing site in Hastings, to overseas centres.
Earlier this month HSBC announced plans to shift 4000 UK jobs to operations in India, Malaysia and China.