Standard Chartered Bank of Kenya last year spent Sh205.63 million on redundancies, marking the ninth straight year of trimming its workforce amid rising staff costs.
The lender discloses in its latest annual report that it closed December 2023 with 1,020 jobs, dropping from 1,061 at the end of 2022.
The previous year it used Sh209.96 million on layoffs as headcount dropped by 59.
StanChart Kenya has now shed 1,028 jobs in the past nine years, resulting in a halving of its workforce from 2,048 end of December 2014.
The redundancies have cost the lender Sh4.09 billion in the nine years amid increased digitalisation and branch rationalisation. The Kenya Bankers Association study showed 45.7 percent of customers preferred fully automated or self-service platforms as at the end of last year.
StanChart last raised its headcount in 2014 when the staff numbers rose by 198 from 1,850 to 2,048 in the year its net profit jumped 12.7 percent to Sh10.4 billion.
Despite the redundancies, staff costs last year went up by 20 percent to Sh6.1 billion from Sh5.1 billion, contributing to the rise in operating expenses.
StanChart Kenya chief executive Kariuki Ngari said the staff costs were rising due to salary increments and retaining of high-quality employees for the relationship management model of dealing with customers.
“We are paying salaries and there is inflation. At any given time, you are adjusting for inflation. If you look at Kenya in the last couple of years, you have seen how inflation numbers have been and so you have to keep adjusting to pay competitive salaries,” said Mr Ngari.
“You also have to factor in that, yes, you have fewer staff but payment per staff is higher. When you look at our business structure, it is relationship-led and so you need the right calibre of relationship managers who can have the right conversation with our customers.”
StanChart Kenya is heavy on affluent and corporate banking, which is mostly run by relationship managers. The lender rides on technology to serve mass retail banking, having made Sh10.5 billion in digital investments in the last four years.
The bank had 42 branches in 2016 but the number had dropped to 33 in 2019 before a further decline in 2020 when it closed eight branches as Covid-19 disruptions fuelled an increased switch to digital channels.
