StanChart spends $372,150 on retrenchment of staff
Standard Chartered Bank Kenya spent Sh214 million [$372,150] to lay off staff in the year ended December when it parted ways with 160 employees.
The redundancy costs dropped from Sh1.3 billion the year before when its staff count stood at 1,280.
The bank’s workforce dropped to 1,120 in the review period, according to disclosures in its latest annual report. The job cuts were witnessed across unionisable and management ranks.
This is the latest retrenchment at Stanchart which has intensified its investment in digital banking services to increase efficiencies and cut costs associated with brick-and-mortar operations.
The lender’s digital services include online, iPad, and mobile banking.
“We have ensured that the management develops attractive value propositions for our clients, advance our digital capabilities to help reduce operational costs and improve customer experience for both our retail and corporate clients,” Stanchart’s chairperson Kellen Kariuki says in the report.
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The lender’s staff count has dropped from 2,048 in 2014, with the bank spending billions of shillings to compensate those laid off over the years.
Stanchart’s staff costs declined to Sh6.5 billion in the year ended December from Sh7.8 billion a year earlier as it benefitted from the cumulative cost cuts.
Other banks also cut jobs last year, continuing with the downsizing that started in the wake of the Covid-19 pandemic in 2020.
Stanchart, which has shuttered scores of branches in recent years, says it will now prioritise locations with significant traffic as it seeks to grow its retail client base.
“We continue to optimise our branch network responding to a significant shift in client transaction preference. We will continue to redefine our distribution footprint leveraging on partnerships with retail brands that have high footfall,” chief executive Kariuki Ngari wrote in the report.
Stanchart closed its books on Wednesday for the final dividend of Sh14 per share which will be paid on May 25.
The bank’s net income rose by two-thirds to Sh9 billion last year from Sh5.4 billion a year earlier.
The profit growth was driven by lower costs and higher non-interest income. Loan loss provision shrunk by Sh1.8 billion to Sh2 billion, contributing to operating expenses falling 17.2 percent to Sh16.5 billion.
Non-interest income including fees rose by a quarter to Sh10.3 billion. Total interest income, however, shrunk by Sh1.4 billion to Sh22.2 billion as the bank reduced its investment in government debt securities.
