Kiwibank has announced its Rotorua Westend branch will close by Christmas, but franchisee Jaymesh Kumar and his wife plan to appeal the decision.

"We were quite gutted when we found out, basically I was thinking more of my staff. I have three staff here, so that's not something good to happen prior to Christmas," Kumar said.

Customers had been coming in to his Westend Dairy, where the Kiwibank and PostShop are based, asking about the closure, Kumar said.

"Our customers are disappointed, it's a natural reaction to what's going on.


"We would like to continue to provide these important services. I'm hoping they [Kiwibank] will reconsider their position, because it affects a lot of people in this area."

In a statement Kiwibank said it carried out a comprehensive security audit on more than 250 branch operations nationwide and made the decision to withdraw banking and related services from three locations - Otara and Owairaka (Mt Roskill) in Auckland, and Rotorua West.

Kiwibank would not disclose any details of the safety audit for commercial sensitivity and security reasons.

Kumar said there had been no incidents that would have deemed the branch "high-risk".

"We've heard there has been a few issues with NZ Post regarding the closures in Auckland because they've had a spate of robberies, but we've had no security concerns here," Kumar said.

"We have a lot of customers and it's just a busy part of the area here, so my thing is why fix something that isn't broken?"

Kiwibank communications manager Bruce Thompson said the franchise operators were informed of the decision and given notification under the terms of their contracts.

"The withdrawal of banking services will all take place prior to Christmas, December 22," he said.

"Postal services are not affected."

Thompson said plans to turn the Tutanekai St PostShop and Kiwibank into a standalone branch of the bank was not related to today's announcement.

There is also a Kiwibank in Central Mall.