The Bank of Queensland (BOQ) is facing legal action from its New South Wales franchise network as it looks to close down underperforming branches.
At least six former franchisees are taking legal action against the bank, while another three are currently in talks with lawyers, and up to ten more are considering their options, The Australian Financial Review reported today.
The news comes after the bank signalled a reduction in branch numbers from 56 to 45 at its 2009 half yearly results with BOQ chief David Liddy blaming the weak NSW economy and poor selection and performance of some branch owner-managers.
But some franchisees have argued the bank’s model was flawed.
“We had an excellent position surrounded by lots of new homes and businesses,” former joint franchisee of the Kellyville branch in Sydney’s west Darren Scott said.
“But the brand had no traction its credit policy was uncompetitive and as our debt got bigger the pressure grew worse.”
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