Barclays is planning to close around 400 branches in the next five years in the UK, due to increasing number of customers moving towards digital modes of banking, according to reports.

Sources familiar with the developments were quoted by the Financial Times as saying that the UK-based bank, which has a total of 1,600 branches, is planning to replace some of the 400 branches with smaller units in Asda supermarkets.

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Reports also said that Barclays was eyeing 40,000 job cuts in a drive to increase profitability amid strict regulatory conditions.

Barclays has denied the rumours, while acknowledging that changes in customer preference will require the bank to change the ways it offers banking services.

A spokesperson for the bank said: "We have no plans to announce significant reductions to our UK branch network.

"Increasing use of technology is changing the way in which customers choose to do their banking and creates opportunities for Barclays to offer services in new ways, complementing the branch network.

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"We have consistently been clear that, over time, there will be fewer traditional branches as we move to provide banking services to customers where and when they find it most convenient. However, the branch network will remain an important part of our banking service and we will never leave a community without the ability to transact."

The spokesperson dismissed the figure of 400 branch closures in five years, saying:

"Whilst it is inevitable that there will be speculation about how these changes will impact on the branch network, this will be driven by the needs of our customers and, therefore, there is not a target for a number of branches to be closed, nor a timeframe for such action."