Massive layoffs to hit banks

Information reaching Business Finder indicates that some banks in the country will undertake retrenchment exercise soon to reduce their high operational costs as a result of difficulties in the economy.

The Business Finder reports that two-tier banks are almost certain to carry out this exercise citing over bloated staff – a situation which is increasing their cost of operations.

While one of the banks is fully indigenous, the other is a foreign owned bank with strong presence in the country.

Presently, there are seven tier-one banks according to the PWC 2014 Ghana Banking Survey. They are  Ecobank Ghana, GCB, Stanchart, Stanbic, Barclays, Zenith and Fidelity Bank.

This paper understands that about 150 workers from each of the two banks will be affected.

With regard to the indigenous bank, Business Finder further learnt that some staff members are anxious to accept the retrenchment offer since the package is expected to be good.

Already, some banks have laid off some workers, mainly contract staff in order to lessen the effect of the economic hardship on their businesses.

As many as about seven banks including GN, ADB and UMB recorded losses last year with very huge impairment. Their balance sheet was also affected by the economic downturn in 2015 coupled with the energy crisis.

A huge number of banks including Stanchart and Societe Generale also witnessed a reduction in their bottom lines.

According to the Bank of Ghana Financial Stability Report for 2015, the Ghanaian banking industry recorded negative 5.4 percent growth last year signaling a difficult financial year.