Standard Bank, Africa’s largest bank by assets, has said that more than 1 000 jobs were on the line as the group contemplates closing down nearly 100 branches across the country.
The bank said the shift in customer behaviour means that its clients are using its branches less.
Standard Bank spokesperson Ross Linstrom said the group had re-looked at its retail and business banking delivery model to meet its customers’ needs.
“A decision has also been taken to close 91 branches, with the vast majority of these closing by June 2019. These changes will impact approximately 1 200 jobs. However, the actual number of employees who will ultimately exit the employ of Standard Bank SA could be lower, as new opportunities will become available in the new operating model,” Linstrom said.
“As part of a support programme agreed with Sasbo, Standard Bank SA will implement a comprehensive exit package which significantly exceeds the requirements as set out in the Labour Relations Act.”
Trade union Sasbo could not be reached for comment.
Standard Bank last week reported a 6 percent increase in headline earnings to R27.9 billion for the year to end December, with a return on equity of 18 percent, up from 17.1 percent compared to last year.
The group’s headline earnings were below that of its competitor, Nedbank, which reported a 14.5 percent increase in its headline earnings earlier in the month.
News of the impending retrenchments at Standard Bank comes just four months after the company said the restructuring of its IT division will see more than 500 workers sacrificed.
South Africa’s big banks have been forced to change their service delivery with the entrants of tech-savvy banks. TymeBank, SA’s first fully digital-driven bank, went live last month, while Discovery is expected to unleash its banking offering this year. Bank Zero, run by former FNB chief executive Michael Jordaan is also expected to launch later this year.
Costa Natsas, the banking and capital markets leader for PricewaterhouseCoopers Africa, said the major banks’ diversification strategies across franchises, regions and portfolios have been central to their ability to achieve growth against difficult trading conditions.
“At the same time, we expect the banks to be acutely focused on the continued evolution of their strategies in the context of heightened competition and the exciting digital journeys they are on – all of which focus on putting the customer at the heart of their business models,” Natsas said.
“The deep and rapid impact that technological progress is set to have on the global banking industry cannot be understated banks are becoming more strategically focused and technologically advanced to respond to customer expectations while deploying defensive strategies to protect market share against traditional competitors and new entrants.”
Media reports earlier this month said the restructuring process unfolding at Absa would claim as many 827 jobs.