South Korean banks streamlined payroll despite record earnings last year as they reduce brick-and-mortar operation and focus more on automated and digital services.
The country’s top four lenders KB Kookmin, Shinhan, KEB Hana, and Woori Bank shed about 2,400 employees through voluntary early retirement incentives from the second half of last year to January. Severance payout reached 1.04 trillion won ($960.7 million).
As many as 1,011 employees opted for early retirement from Woori Bank in July alone, compared with annual average of 300 in the previous year and in the first half of 2017. Payroll was reduced to 14,356 from 15,649 in 2016. The bank compensated 178 billion won to early retirees, up 68.5 percent from a year earlier.
At Shinhan Bank, 780 employees applied for early retirement last month, compared with 280 in the previous year. Severance pay jumped to 285 billion won from 185 billion won a year earlier.
KB Kookmin Bank saw off 400 employees last month and compensated them with 155 billion won. KEB Hana Bank shed 207 employees at a cost of 93 billion won.
The trend is likely to continue as banking sector turns digital and online.
By Kim Tae-sung and Cho Jeehyun
[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]