Yes, that’s basically it.
They only opened the in-store branches when they launched current accounts, and they’ve obviously now decided that there is no money in either branches or current accounts, so they have scrapped them. It doesn’t make sense for a relatively small proportion of your business to be a massive source of costs. The initial plan to have a big push into acquiring customers hasn’t worked, as the only customers they have acquired have either been core M&S style elderly people (who are expensive to serve; since they require branches) and the MSE brigade (who went after switch bonuses and then took advantage of the regular saver).
Their much more popular product has always been their credit card, which does appeal to M&S shoppers as there are various reward schemes available for it. They will be continuing to offer that, as their main product basically, and a little light lending through their loans business plus capital raising through savings covers the rest.
I expect them to trundle along much as before, maybe even being a moderate success, but their ambitions of being a significant player in the market are clearly now over.
They will continue to have Bureaux de Change desks in store, which they sell travel money from, so that’s another avenue to profit.