Lloyds Banking Group, one of the largest financial institutions in the UK, is restructuring its risk management division following an internal review that identified it as a "blocker to [its] strategic transformation."
Chief Risk Officer Stephen Shelley stated in a memo that two-thirds of executives perceive risk management as obstructing progress, and less than half of the workforce believes in promoting intelligent risk-taking. The overhaul will primarily focus on non-financial risk management, aiming to facilitate faster operations with clearer roles and responsibilities, Shelley said. Despite criticism from the independent BTU union, which warns against the potential consequences of loosening risk controls, Lloyds is pushing forward with its plan.
Approximately 175 permanent roles are at risk, with 150 of them in the risk division. The bank plans to create 130 jobs emphasizing specialist risk and technical expertise. The restructuring aims to address frustrations with time-consuming processes and outdated practices that are seen to hinder competitiveness. This comes amid industry-wide scrutiny over potential mis-selling in auto financing operations, for which Lloyds has allocated £450 million to cover any related penalties and restitution.
Lloyds is in the midst of a £4 billion investment plan spanning five years, seeking to diversify income away from mortgages toward more stable revenue streams like wealth management and insurance. Digitalization is also a key focus, with thousands of middle-management positions reviewed to bolster digital services. Currently, around 3,600 employees are involved in the bank's risk teams.
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