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A customer uses an automated teller machine outside an Australia & New Zealand Banking Group Ltd. branch in Sydney. (Bloomberg) |
Australia & New Zealand Banking Group Ltd., the third-largest bank in Australia, plans to eliminate about 1,000 jobs by Sept. 30 as it combats a slump in lending growth and higher funding costs.
The cuts will be in the Australian businesses and will primarily involve middle-management, back-office and support staff, the Melbourne-based bank said in an e-mailed statement Monday. ANZ Bank currently employs 49,000 people globally, including about 24,000 in Australia, it said.
ANZ Bank joins larger rival Westpac Banking Corp. in confirming plans to reduce jobs as the nation’s lenders confront the weakest demand for home lending since 1977. UBS AG forecast last month that Australian banks may eliminate 7,000 jobs in the next two years as they seek to pare labor costs that account for 58 percent of expenses.
“A different and very difficult environment is now emerging for banks globally,” Philip Chronican, chief executive officer of ANZ Bank’s Australian business, said in Monday’s statement. “Just as we are seeing in other parts of the Australian economy, we are also having to adapt our business to the new conditions and become leaner, more agile and more customer-focused so we ensure the bank remains strong and can grow and invest for the future.”
Shares of ANZ Bank rose 1.3 percent to AU$21.70 at 1:31 p.m. in Sydney. The benchmark S&P/ASX 200 stock index gained 0.3 percent. ANZ Bank is scheduled to publish on Feb. 17 a trading update for the three months ended Dec. 31.
As many as 400 people will lose their job at Westpac, Australia’s second-largest bank, with most of the positions affected to be from the Sydney-based lender’s head office and technology and operations divisions, spokeswoman Supreet Gosal said Feb. 2.
Peter Hanlon, Westpac’s acting head of Australian financial services, told the Australian newspaper on Feb. 2 that a slowdown in business and consumer activity is happening across the board. He said conditions are as bad as he’s seen them in his 30 years of banking, according to the newspaper.
ANZ Bank said in the statement that staff in Australia were told Monday of 492 roles affected by the reductions. (Bloomberg)
“In this environment, the right thing to do is to be upfront with our staff and with the community about the changes needed in banking and their implications,” ANZ Bank’s Chronican said. “We are acutely conscious of the impact of these reductions on individual staff members and we will be making every effort to use natural attrition, to redeploy staff, and to utilise our training funds to support those people affected.”
‘No Justification’
Monday’s job cut brings the number of finance jobs cut from the industry since the start of the year to 2,000, according to the Finance Sector Union, which represents some bank workers.
“There is no justification for any Australian bank to slash jobs,” Leon Carter, the union’s national secretary, told reporters in Melbourne Monday. Given their combined profit of more than AU$24 billion ($25.7 billion) in 2011, “if anyone can afford to invest in Australian finance jobs it is our four big banks,” Carter said.
ANZ bank will also continue to “constrain senior executive salary increases,” as part of a measure it announced last year, the bank said in Monday’s statement.
For “most senior executives, that means salaries will remain fixed for the 2012 financial year,” the bank said.
ANZ Bank and Westpac on Feb. 10 both raised their standard variable mortgage rates independently of the central bank, which left borrowing costs unchanged last week. The two lenders cited a jump in wholesale funding costs. (Bloomberg)
