Co-op cuts 670 jobs as sales team is scrapped

The field-based financial advice team is made up of 497 sales staff with the remainder in office- based managerial and support roles.

The job losses are part of the company’s strategic review of its life and savings business, which was set up to consider the impact of new rules affecting financial advice in the UK.

CFS, part of the Co-operative Group, said the Retail Distributive Review (RDR), which will come into force in January 2013, will lead to increased regulatory costs.

Banking giant HSBC last month cut 700 jobs across the UK as it prepares for a drop in demand for financial advice as a result of the changes in the RDR.

CFS employs 12,000 staff and has eight million customers. It has more than 300 high street branches, 20 corporate banking centres and a major presence in Manchester, London, Leek, Plymouth, Skelmersdale and Stockport.

A further 82 existing Co-operative branch-based roles will be transferred to AXA, with which the group has a partnership.

CFS revealed it has entered into talks with insurance firm Royal London to sell its life insurance subsidiary, including £15bn of assets.

CFS chief executive Neville Richardson said: “We have taken the time needed to consider all our options and find a solution which is ultimately in the best long-term interests of our customers and members.

“We understand that such news may be difficult for impacted colleagues and we have not reached this outcome lightly.

“However, we were faced with rising regulatory costs in a business which was increasingly becoming sub-scale.

“This move supports our strategy to focus our specific attention on our banking and general insurance areas.”