SHANGHAI: Total headcount at China’s four largest banks fell in 2016 for the first time in six years, as the lenders cut costs and tried to adapt their massive branch networks in the face of competition from online payment giants Ant Financial and Tencent Holdings Ltd.
Industrial &Commercial Bank of China Ltd, China Construction Bank Corp, Agricultural Bank of China Ltd and Bank of China Ltd employed 17,824 fewer people at the end of 2016, the first such drop since at least 2011, an analysis of their earnings filings last week showed.
The drop reflected in part the way the nation’s banks are trying to trim the estimated three million people who work in their branch networks.
About 3.8 million people work for China’s banks, according to the banking regulator. Some 80% of them are bank tellers in the branches, according to an estimate in an April 1 report by Zhou Kunping and Li Ying, Shanghai-based analysts at Bank of Communications Co.
ICBC, the world’s largest lender with more than 16,000 outlets, reduced its number of branch tellers by 14,090 last year, the banking association said. The figures reflect staff reductions as well as redeployment of workers to other functions.
Teller numbers fell by 30,007 at Construction Bank and 10,842 at Agricultural Bank, the association said. Continued redeployment will help Chinese banks reduce the number of their tellers by another 20 percent over the coming decade, the Bocom analyst report said.
Chinese banks are also reducing staff at a time of pressure on their earnings. The four largest Chinese banks narrowly avoided their first decline in combined annual profit since 2004, thanks to cost reductions and the lower-than-expected charges for bad loans.
Their total net income of 858.2 billion yuan (US$125bil) for 2016 was 0.2% higher than the previous year, data compiled by Bloomberg show.
China’s big four banks employed a total of 1.63 million people at the end of 2016, according to their earnings filings. – Bloomberg.