Note: Road distances will exceed the radial mileage, significantly in some cases, and journey time is a more appropriate measure of convenience loss especially relevant in urban areas.

The above table evidences the small number of branches that will benefit from the longer (12 weeks) notice of closure introduced into the Banking Code in 2003 for those in excess of 5 miles from the next nearest bank, compared with the additional number which would have benefited if the independent reviewer’s recommendation of 1 mile urban and 4 miles rural had been accepted. The banks’ criterion disqualifies all urban last banks.

If, as predicted, branches currently protected by pledges not to close “for the foreseeable future” the last bank existing (as at May 2000) in a discrete town or village become subject to the 5 mile radius qualification then over 300 in England & Wales, and a further 100 in Scotland, will lose the protection. By selecting a 5 mile radius as the only criterion for their failed 2002 ‘shared banking’ pilot scheme in England & Wales, it is now obvious that the banks’ interest was not in improving customer convenience but in tightly ring fencing the scheme’s potential had it succeeded.

In urban areas it is not distance of travel to the next nearest bank branch, or choice of bank, that is the issue but time taken to get there and back due to traffic, road systems, pedestrianisation, parking and public transport difficulties. Professor Elaine Kempson of Bristol University’s Personal Finance Research Centre has proposed in her work for the British Bankers’ Association and for the Banking Code that a radius of 1 mile in an urban area should be equated with a radius of 4 miles in a rural area. In both cases road distance would be greater than the radial measurement.

It is tempting to want to discount the urban branches in the < 1 mile band but there must have been reasons why these centres merited the initial investment of separate branch representation and the branch(es) concerned have survived previous branch culls, presumably for good business reasons. CCBS files reveal many examples of distinguishable urban communities with retail and commercial activity (for example ethnic communities) existing within a mile radius of the town/city centre which would suffer if the local banking facility were to be withdrawn.

Note: Road distances will exceed the radial mileage, significantly in some cases, and journey time is a more appropriate measure of convenience loss especially relevant in urban areas.

Although marginally less vulnerable than sole bank situations, if a return to branch closure programmes is accompanied, as before, by the proven ‘domino’ effect then protection and competitive choice could be short lived.

It is also relevant that the pledges given by some banks to remain open if they are the “last bank in town” apply only to such situations existing in May 2000 not situations which result from subsequent closures by a competitor(s).

It is relevant that when assessing competitive choice in local banking markets the French authorities use a yardstick of 10 minutes drive time and our own Competition Commission when looking at supermarket competition has used 15 minutes drive time and a minimum of 3 competing fascias.. The case for ‘time elapsed’ rather than radial or road distance as a measure merits serious consideration before bank branch closure programmes resume after the current pause.