LONDON: Nationwide Building Society said on Friday it would spend an additional 1.3 billion pounds (US$1.7 billion) on technology, as the British lender works to keep pace with the growing popularity of online and mobile banking.
The building society, one of Britain's biggest mortgage lenders, said it would use the funds to build new technology platforms and drive forward its digital and data strategies.
Nationwide Chief Executive Joe Garner said as part of the investment it expects to create an additional technology hub in Britain, employing between 750 and 1,000 people over time.
"At a time when customer expectations of service are rapidly changing in a digital world, we are investing to ensure that we continue to transform member experience on the high street," said Nationwide Chief Executive Joe Garner.
Britain's lenders have been cutting back branches and investing heavily in technology as footfall in stores declines and consumers increasingly do their banking online or on their phones.
They also face a threat from upstart financial technology firms that are enjoying growing popularity.
Nationwide said it would continue to invest in its branches as well as its technology offering, with the latest investment expected to increase efficiencies.
It had increased its savings target to 500 million pounds by 2023, rather than 300 million pounds by 2021, it said.
However the investment will mean recognising a charge of 200-250 million pounds in the current financial year as a result of the additional spending, it said, with around half of that to be recognised at its half-year results.
The announcement takes the lender's total investment over the next five years to 4.1 billion pounds.
(US$1 = 0.7627 pounds)
(Reporting by Emma Rumney; editing by John O'Donnell and David Evans)