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Corporate News

KCB to lay off staff in cost cutting drive

A KCB banking hall in Juba. The bank says it is restructuring to cut costs. FILE PHOTO | NMG
A KCB banking hall in Juba. The bank says it is restructuring to cut costs. FILE PHOTO | NMG 

KCB Group #ticker:KCB is set for another round of layoffs in an early retirement scheme for its employees intended to save Sh2 billion per annum in staff costs.

The bank, which is Kenya's largest by assets, attributed the move to impact of the recent interest rates capping and technology changes in the industry.

"The programme is expected to align the competing needs of adapting to a banking industry whose outlook has been dimmed by legislative and regulatory reforms, and fast evolving technology platforms that are now attracting non-traditional players into the financial services sector," said KCB in a statement.

Employees who opt for retirement will receive at least three months’ pay medical insurance cover for the rest of the year.

"Other benefits include loan rebates that will see 25 per cent of the outstanding staff loans balances paid off and the remainder to continue at staff rate for six months," said the lender.

Chief executive Joshua Oigara said in the statement that the retrenchment is intended to help cut costs and boost returns to shareholders.

KCB’s staff count dropped by 223 last year, with Sh186 million spent to compensate the affected employees.

The retrenchment also affected staff in some of its subsidiaries across the region - closing 2016 with 7,192 employees on its payroll.

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