Newcastle Building Society today said it would close four branches and cut 126 jobs in a bid to slash costs.
The mutual - which currently has 985 staff - said back office and management roles would be affected as it looks to preserve customer facing roles.
The branches chosen for closure are Crook in County Durham, Yarm in Stockton-on-Tees, York, and West Road in Newcastle - reducing its network from 35 to 31 branches.
The UK’s eighth largest building society added it was creating around 80 customer service jobs following a contract win and would try to keep compulsory job losses to a minimum by offering voluntary redundancies as well as jobs elsewhere in the group.
Chief executive Jim Willens said: "To remain strong we need to be realistic in the knowledge that this is still a very challenging climate for the financial services sector.
"We have to make some difficult decisions but these will benefit the society and the majority of its staff in the long-term."
The mutual is also shutting a final salary pension scheme which closed to new entrants ten years ago, which impacts 138 members.
Rob MacGregor, national officer at trade union Unite, said: "The news that a key financial institution such as the Newcastle Building Society is having to make cost savings of this scale is extremely disturbing.
"As this building society takes action to improve their situation it is a sad reality that a significant number of the hard-working and committed staff they employ will lose their jobs."
