SG
DBS is slashing 900 staff – mainly in Singapore and Hong Kong – as Q3 net profit slumps by 38%.
It’s the biggest sign yet that Asian banks aren’t immune from the global financial crisis and aren’t afraid to hammer their headcounts.
The bank’s decision introduces an unwanted new arrival to the Asian employment scene: the Wall Street-style three-figure mass lay-off. So far most banks have been comparatively timid with their recent trimming in the region, with 100 redundancies considered a large number.
And at 6% of its entire workforce, the local DBS bloodbath is proportionally higher than some of the global redundancies at much larger banks. Morgan Stanley, for example, has cut about 1,330 jobs this year – less than 3% of its headcount.
DBS chief executive Richard Stanley says in statement that most of the cuts, to be carried out at the end of November, will come from its offices in Singapore and Hong Kong.
“To be a streamlined organisation, I believe we must run a tighter ship…We have been vigilant on costs but as the economy enters a more difficult and uncertain phase, many financial institutions around the world and in Asia have made headcount reductions,” he adds.
The global financial crisis and bigger provisions have reduced market-related income at DBS. Third quarter net profit totaled SG$379m, down from SG$610m in the same period last year.
DBS would not comment on which job functions would bear the brunt of the costs.
An already depressed recruitment market must now cope with hundreds of new job seekers.
why not look for other options like pay cut???
DBS could have better this issue.. have they consider other factors to resolve this or they are taking a easy way out?
Looking at the way the news reflect.. surely the management of DBS has acted in a way that does not reflect it to be a “friendly” bank which was projected and maintain by the previous management….
This is generally the Westerners’s style. Anything goes wrong, the first thing that comes to their mind is “CUT HEADCOUNTS”.
Look within and identify the problem. One potential issue is IT inefficiency :-
In fact, IT inefficiency is the most costly portion in most banks. Banks are either “not able” or “not willing” to invest budgets to get their IT platform properly equipped for their blooming businesses. Many a times, the transition between so many systems caused huge delay in processing, inaccuracy and money.
Having a strong platform to book deals from FO, to process in MO and finally to settle accurately in BO provides a one-stop easy linked process and cut down unnecessary costs.
Get this resolve, you may end up saving more money and your staff can have more time to brainstorm for ideas to bring in more business.
With a negative news, it comes with a negative image, thus a negative impact. Confidence is greatly shaken. Who dares to have dealing with a bank that employs such tactis?!!
Maybe the BIG BOSSES of DBS should follow what the government does, cut the pay of the higher level. This in return generate a huge saving and also save the jobs of many who depend on their meagre salaries to support their family!!
Stop thinking for yourselves and have some mercy on the lower level!
I note the comment from Fren regarding IT inefficiencies. Information Technology improvement needs to be run through formal project assessment and then, if passes charter, managed carefully through stage-gates and reviewed regularly to ensure ongoing fit with strategy and that the change effort is on track.
I would suggest perhaps a more effective effort to weed out inefficiencies is to review the effectiveness of programme and project management at the bank as well as existence and actual usage of an overarching standardised process management library (which itself may be radically outdated, hence providing a poor fit for relevance for such IT projects).