Kenya’s largest bank by assets KCB Group has confirmed plans to lay off an undisclosed number of staff in its Kenyan unit to cut expenses. The lender said yesterday the redundancies had been occasioned by “fast evolving technology changes, and a dynamic regulatory regime”.
“KCB Bank has over the past two years been reviewing its operations in an effort to improve efficiency, serve our customers better, and meet the expectations of our shareholders,” said the bank in a statement.
“The review, which is an ongoing process that has seen us relook our workforce, has been done in keeping with the best business practice in an industry that is undergoing a major transformation driven by fast evolving technology changes, and a dynamic regulatory regime.”
The NSE-listed bank, however, declined to disclose the number of staff to be affected by the looming retrenchment which has unsettled its workforce. This month KCB sent home 28 staff at its Rwandan subsidiary. “The process is being handled in accordance with the law. Further details of the exercise will be provided once it is complete, as the bank is currently in a closed period,” the lender said.
KCB Group chief executive Joshua Oigara had in November said KCB will weather the new interest rate capping storm that is expected to thin margins for lenders. He also ruled out staff redundancies.
“We see stability in the sector and obviously we are seeing huge interest from our clients in terms of loan requests based on the new regime,” said Mr Oigara when he released the bank’s results.
Several banks have been cutting their workforce lately in what has seen hundreds sent home. They include Bank of Africa Kenya, Standard Chartered, Ecobank, Family Bank, Sidian, and Islamic financier First Community Bank. KCB Group announced a 15 per cent growth in third quarter net profit to Sh15.9 billion, keeping the lender slightly ahead of close rival Equity Bank.
Mr Oigara said then the performance was driven by strong growth in interest income as KCB saw this revenue stream grow by Sh7.8 billion to Sh36.1 billion, representing a 27 per cent increase. KCB plans to up scale its efforts towards enhancing its digital platforms as more of its customers move away from stone and brick branches.