Handelsbanken joins the ranks of lenders downscaling their physical presence in face of growing digitalisation in the sector.
It said in a statement that it plans to reduce the number of branches in Sweden to 200 from around 380 at present in a bid to cut costs to 20 billion Swedish kronor (1.9 billion euros, $2.3 billion) by the end of 2022.
The closures will affect some 1,000 employees – or one in seven of its domestic workforce – over the next two years, the statement said.
Negotiations were currently under way with trade unions, but Handelsbanken said it would set aside 1.5 billion kronor in its fourth-quarter accounts “to facilitate these adjustments”.
At the same time, the group said it would invest 1.0 billion kronor over the next two years “in order to take its digital customer offering to an entirely new level”.
“We're currently observing that customers are using digital channels and other means to meet up, rather than in our branches,” chief executive Carina Akerstrom told SVT public television.
Unlike its Nordic competitors, Handelsbanken has until now set great store by its bricks-and-mortar presence on the high street.
Rival Swedbank, for example, currently has only 160 branches in Sweden.
In addition to its domestic workforce of 7,000, Handelsbanken also employs 5,000 staff outside Sweden, notably in Britain, Denmark and Finland.