* Lloyds to close Cheltenham & Gloucester network
* 164 branches to close in November
* Stock up 2.6 percent
(Recasts with Lloyds confirmation, adds union comment)
LONDON, June 9 (Reuters) - Lloyds Banking Group is to close all branches of its Cheltenham & Gloucester unit as part of a shake-up of its mortgage and loans operations that will result in the loss of up to 1,660 full-time jobs.
Lloyds said on Tuesday the 164-branch network of Cheltenham & Gloucester, which specialises in mortgages and savings, would be closed in November.
The loss of the familiar brand on Britain's high streets comes two weeks after Spain's Santander said it would replace the brands of its British businesses Abbey, Alliance & Leicester and Bradford and Bingley with its global red and white logo from 2010.
Lloyds has already shed around 3,000 jobs since it took over rival HBOS in a government-brokered rescue deal that has saddled it with massive loan losses.
LTU, the largest union representing Lloyds staff, described the redundancies as unjustified.
"There are Lloyds TSB and HBOS branches close to all C&G Branches and we are insisting that staff in those branches be invited to apply for voluntary redundancy before any C&G staff are made compulsorily redundant," said Steve Tatlow, Assistant General Secretary at LTU.
Although Lloyds said employees had been told about the process, there was confusion in some branches, with some customers reacting angrily to the news.
"We've had people in this morning who are being very rude, all the branch managers are out and we're left to deal with the flak. We still haven't been informed. It's appalling," said a C&G employee at a branch in northern England.
Cheltenham & Gloucester, previously a building society, and which can trace its roots back to 1850, was taken over by Lloyds Bank in 1997, triggering windfalls for its members.
Lloyds reiterated its plan to use a multi-branded strategy, centred on mortgage giant Halifax, Bank of Scotland and Lloyds TSB.
The Bank of Scotland and Intelligent Finance brands will not write new intermediary business from July 1, however, while the group's personal loans product team will move from Chester in north-west England to London, Lloyds said in a statement.
Its shares were up 2.6 percent at 62.7 pence at 1210 GMT.
"The closing of these C&G branches makes huge economic sense even though the human story is unpalatable," said David Buik, senior partner at BGC Partners. "I suspect there is more to come from where that news came from." (Reporting by Kate Kelland, Paul Sandle and Victoria Bryan; additional reporting by Lorraine Turner; editing by Paul Hoskins and Simon Jessop)