South African lenders are battling to grow revenue faster than costs as they contend with an economy that has shrunk for three of the past five quarters.
Sunday 28, July 2019
Nedbank Group is in talks with about 1,500 employees over potential job cuts at the South African lender’s retail and business-banking division to cope with a struggling economy and increased competition, reported Bloomberg.
The Johannesburg-based lender stated that the company forecasts that between 50 and 100 employees are at risk of not being placed in a role, unplaced employees will then be assisted by the bank to either secure available alternative positions within the bank or be equipped for opportunities outside the bank.
Consumers have been battered by rampant unemployment, rising taxes as well as fuel prices and utility bills, pushing them to explore cheaper banking alternatives or digital services.
Additionally, companies are not investing amid uncertainty over electricity supply and surging government debt levels.
Nedbank said that it's being forced to reshape its operating models and businesses, and non-voluntary retrenchments are the lender’s last option.
The company, which employs 30,577 people, has also been reducing the floor space used by its branches and increasing the use of automation to lower costs.