East Dunbartonshire Council is to close its Municipal Bank following a vote by members on June 26.
Arrangements will be made in the coming months to wind up the bank.
A detailed plan of the closure and the timescale for this taking place will now be prepared, and the first step of this process will be a meeting of the directors of the bank, which will take place after the summer.
East Dunbartonshire Municipal Bank currently operates out of council offices at Bearsden, Lennoxtown and Southbank Road in Kirkintilloch and is marketed as “the friendly bank”.
It has traditionally offered a competitive rate of interest which compares favourably with the larger banks and building societies, with deposits being invested with the council to help reduce council tax.
Council leader Rhondda Geekie said: “Our transformation programme is designed to ensure that all aspects of the council are as efficient and effective as possible and this decision has been part of that process.
“As soon as the closure details, including the timescales are available we will be advising all employees and Municipal Bank customers of the arrangements being put in place.
“Until then, all bank business will continue as usual. The bank has had a long-term presence locally and the council’s ‘Financial Inclusion Strategy’ will be focused on smoothly facilitating these changes.”
News of the closure has met with a mixed reaction - with some concerned about what the closure will mean.
On the Herald’s Facebook site David Bauld said: “It is a disgrace that this is being closed. Councillors lined up to condem payday loan companies recently yet close the best chance social government has to take action.
“The Municipal Bank was an asset that could have raised council residents out of spiralling debt cycles with low interest restructures.
“It is a disgrace this is allowed to happen, but was always on the cards after Tom Johnston House closed.
“The hubs aren’t secure enough to provide cash transactions.”