Zim banks cut 1,000 jobs in 2014

Allied Bank’s license was recently cancelled by the Reserve Bank of Zimbabwe.

BANKS in Zimbabwe cut 1,000 jobs last year, eliminating one post out of every six in the southern African country’s banking industry, a union official said.

ZB Bank Ltd. eliminated 500 positions, while Steward Bank Ltd. and AfrAsia both trimmed 83, said Shepard Ngandu, assistant secretary general of the Zimbabwe Banks and Allied Workers Union. The local units of Standard Chartered Bank and Barclays Bank Plc offered staff voluntary severance packages, he said in an interview in the capital, Harare.

The Reserve Bank of Zimbabwe is setting up an agency that will buy bad loans from lenders that run as high as 90 percent in some cases, Deputy Governor Kupikile Mlambo said in October. With the central bank canceling Allied Bank Ltd.’s license last week and Tetrad Bank Ltd. in talks with creditors, prospects for 2015 are gloomy for for an industry once viewed as a haven for workers, the union’s Ngandu said.

“This year, the situation is not looking good at all, because 250 workers lost their jobs at Allied Bank,” he said. “If the scheme of arrangement being negotiated at Tetrad Bank doesn’t materialize within the next 10 days, it means 130 workers will be jobless. This year is going to be a very difficult year for the banking sector.”

The industry employed about 6,000 people as of last year, Ngandu said. – Bloomberg