Lloyds Banking Group is preparing to cut roles across its risk management division, stating that it was a “blocker” to the company’s transformation strategy.

The FT has reported that chief risk officer at Lloyds, Stephen Shelley, said in a memo last month that following an internal review, the group was “resetting its approach to risk and controls”.

He went on to state that two thirds of executives at the group thought risk management was impending progress, while less than half of the workforce believed that “intelligent risk-taking” was encouraged.

Adding to this, Shelley stated that a new model would allow for Lloyds to “move at greater pace”, with clearer roles and responsibilities.

However, there has been some backlash to the move, with general secretary of the BTU, Mark Brown, stating that the banking group seemed to be “throwing the baby out with the bathwater”, as the lender is under scrutiny as part of an industry-wide probe into the potential mis-selling of car finance.

He continued by saying that if Lloyds’ loosens its risk controls “could potentially have catastrophic consequences for the future of the bank”.

Lloyds has set aside £450m to cover any potential costs following the investigation, but analysts have estimated that it could cost up to £2.5bn.

The FT also stated that, according to one person who is familiar with the restructuring process, that about 175 permanent roles were in jeopardy as a result of the changes, with 150 of them in the risk division.

The person added that the bank also planned to create 130 jobs focused on specialist risk and technical expertise.

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