KCB lays off 240 employees in first half of 2019

KBA CEO Joshua Oigara

Increased investments in digital outlets has seen Tier 1 bank KCB retrench 240 employees in the first six months of 2019 to set its employee headcount at 5,980 down from 6,220 at the end of 2018.

According to the lender’s CEO Joshua Oigara in a news report by the Business Daily, the four percent decrease in the company’s workforce was inevitable amid the growing trend that has seen banks shift operations to digital platforms.

“For efficiency, we will see less and less jobs in the industry. In reality, as we build much more investments in our digital channels and agencies, we will see fewer jobs in our establishments,” Mr. Oigara is quoted as saying by the Business Daily.

KCB’s CEO however insisted that the shift to digitization by banks will create more job opportunities for digitally oriented Small and Medium Enterprises (SMEs) operating within the country. The bank’s 2jiajiri program for example has seen more than 21,739 Kenyans get opportunities in different sectors such as automotive engineering, building and construction as well as agribusiness.

“The future of jobs in the banks is actually to create jobs in different sectors and businesses by working with entrepreneurs. We have to reorganise and reimagine job creation in the sector by investing in small businesses,” Mr. Oigara added in the Business Daily report.

According to the Central Bank of Kenya, banks will continue to trim their workforce in an effort to increase their operational efficiency as they implement modernisms such as financial technology, blockchain and artificial intelligence. CBK data similarly reveals that the wage bill of most banks has increased despite the lenders’ efforts to trim their workforce because the retained employees negotiate for better compensation due to increased workloads.

KCB posted a five percent profit increase in the first six months of the year to Ksh. 12.7 billion up from Ksh. 12.1 billion registered in a similar period last year. According to Mr. Oigara, the significant increase in its net profit in the period under review was as a result of effective cost management, the lender’s loan book growing and increased activity on its mobile money channel.

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