DBS is spending less on its average employee that last year, even as its profits rise and its local rivals UOB and OCBC continue to boost compensation, according to figures calculated from its third-quarter results.
Staff costs per head at DBS – total employee expenditure (such as salaries and bonuses) divided by total headcount – fell by 1.5% ($1,332) year on year to reach $90,128 for the first nine months of 2018.
The DBS earnings report doesn’t address the drop in average remuneration, but it does state that the final incorporation of ANZ employees, which took place in February, has affected its year-on-year costs. While taking on thousands of ANZ staff – DBS acquired the Asian wealth and retail operations of the Australian bank in 2016 – has obviously boosted overall expenses, one insider at the bank told us that it’s also helped to push down salaries per head.
Although DBS has retained many of ANZ’s well-paid private bankers and priority bankers, the bulk of the transitioning ANZ staff work in less lucrative retail and support roles. Moreover, the ex-ANZ workforce also includes employees in China and Indonesia, not just people in the high-cost markets of Singapore and Hong Kong.
The decrease in average comp at DBS is in contrast to the year-on-year rises at UOB (up by 10.4%) and OCBC (4.5%) for the first nine months, which were partly driven by the recruitment of expensive technologists amid a tight local labour market in tech. The two smaller Singaporean banks still have a way to go to catch up to DBS on the pay front, however. Despite pay inching down, DBS still spent just over $90k per staff member – compared with $71,633 at UOB and $65,514 at OCBC.
DBS, whose year-on-year profits rose 34% in the year to end-September and 76% for Q3, has larger non-retail front-office operations than those of its rivals, helping to explain its salary advantage. If you’re looking for a front-office job at DBS, you might want to try cash management. An 8% rise in income in the firm’s institutional banking division (to $4.26bn) was “led by growth in cash management”, according to the bank’s Q3 report.
Have a confidential story, tip, or comment you’d like to share? Contact: email@example.com
Image credit: Tomatopicturesm Getty