{"id":396093,"date":"2020-05-08T07:44:25","date_gmt":"2020-05-08T05:44:25","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=396093"},"modified":"2020-05-08T07:46:17","modified_gmt":"2020-05-08T05:46:17","slug":"south-africa-facing-jobs-bloodbath-as-banks-hold-off-on-any-further-layoffs","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/banking\/396093\/south-africa-facing-jobs-bloodbath-as-banks-hold-off-on-any-further-layoffs\/","title":{"rendered":"South Africa facing jobs bloodbath as banks hold off on any further layoffs"},"content":{"rendered":"

Standard Bank Group and Absa Group are among South African banks holding off on any further layoffs as they prepare to help the shrinking economy survive a potential jobs bloodbath.<\/p>\n

Local lenders join global institutions from New York, Paris, London and Frankfurt that have pledged to preserve jobs during the coronavirus pandemic.<\/p>\n

Most South African lenders have already trimmed staff as they moved to digital services and dealt with an economy struggling with a series of recessions and a 29.1% unemployment rate \u2014 even before a lockdown to contain Covid-19 brought businesses to a halt.<\/p>\n

\u201cAt present, the bank is in a strong financial position and we do not anticipate or see the need for retrenchments as a response to the pandemic,\u201d Johannesburg-based Standard Bank, Africa\u2019s largest lender, said in an email.<\/p>\n

\u201cHowever, we cannot offer unconditional or permanent job stability should the economic situation deteriorate.\u201d<\/p>\n

Absa said it has a freeze on new hires, while FirstRand\u2019s First National Bank, Nedbank Group and Capitec Bank aren\u2019t looking to make any cutbacks.<\/p>\n

The nation\u2019s finance industry, which includes real estate and insurance, is the third-largest employer, while the six largest lenders, including London and Johannesburg-based Investec Group, have almost 186,000 workers across their operations.<\/p>\n

\u201cThe large banks have got enough capital so I don\u2019t fear for them,\u201d said Jan Meintjes, a portfolio manager at Cape Town-based Denker Capital in Cape Town.<\/p>\n

\u201cThey\u2019re probably in a good position to hold onto staff.\u201d<\/p>\n

The banks are at the centre of the government\u2019s plan to help shore up an economy the National Treasury estimates could contract 16.1% this year in a worst-case scenario. That would wipe out about 40% of the jobs in Africa\u2019s most-industrialised country.<\/p>\n

The Treasury plans to use lenders to disburse R200 billion of guaranteed loans, mainly to small- and medium-sized enterprises.<\/p>\n

No fat<\/strong><\/p>\n

After lowering their staff numbers by not filling positions left vacant by resignations or retirements as they digitised their operations and services, the banks don\u2019t have much fat left to trim, said Nolwandle Mthombeni, an analyst at Mergence Investment Managers.<\/p>\n

\u201cThey\u2019re very profitable as it is, so the banks can actually withstand keeping the costs on for the next year,\u201d she said. \u201cThey are not in a position where they need to do aggressive retrenchment.\u201d<\/p>\n

Only FirstRand, the largest of the lenders by market value, and Capitec added jobs in their most recent financial periods. Nedbank, Standard Bank and Absa together shed 6 680 employees across their operations last year.<\/p>\n

\"\"<\/a><\/p>\n

Absa isn\u2019t considering retrenchments, it said in an email. Nedbank will continue to explore alternative roles for staff affected by digitisation and will seek to review its cost base in ways that do not affect its workforce, it said, adding that \u201cretrenchments will always be an option of last resort.\u201d<\/p>\n

First National Bank is encouraging internal moves to fill existing vacancies and not considering a restructure of its workforce because it is too early to evaluate the impact of Covid-19, the Johannesburg-based lender said in an email.<\/p>\n

Capitec Bank, which has grown its network while others have scaled back, is limiting recruitment to essential areas that will support its growth plans, the Stellenbosch-based company said.<\/p>\n

There\u2019s no way of knowing what a deeper slump in South Africa\u2019s economy could spell for bad debts, earnings or the balance sheets of lenders, said Meintjes. Lenders agree, with most having withdrawn financial guidance for 2020.<\/p>\n

\u201cI don\u2019t think any of them will fall over,\u201d he said. \u201cBut I think the next year is going to be painful for them.\u201d<\/p>\n

\n

Read: South Africa\u2019s jobs shocker after the 35-day lockdown<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Standard Bank Group and Absa Group are among South African banks holding off on any further layoffs as they prepare to help the shrinking economy survive a potential jobs bloodbath.<\/p>\n","protected":false},"author":59,"featured_media":390529,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[961],"tags":[29,1798,4088,26,1799,499],"class_list":["post-396093","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-banking","tag-absa","tag-capitec","tag-firstrand","tag-headline","tag-nedbank","tag-standard-bank"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/396093","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=396093"}],"version-history":[{"count":4,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/396093\/revisions"}],"predecessor-version":[{"id":396119,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/396093\/revisions\/396119"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/390529"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=396093"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=396093"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=396093"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}