WISE
Securing Your Future Is Our Main Investment
Home About Us Broker / Dealer Services Markets & Research Investor Guide Contact Us
Today's Trades

Financial News

Senior staff, agency cuts at NCB

Feb 10, 2010

With its profit spurt threatened by expected losses from the government-imposed debt swap, rising operational costs and income challenges in some segments of its operations, National Commercial Bank (NCB) has moved to trim its senior ranks, and has signalled deeper staff cuts and further shrinking of its sub-branches.

"We are looking at everything," managing director Patrick Hylton told Wednesday Business, when asked about cuts among the bank's 2,534 corps, potential branch closures and wage increases below the 12 per cent staff took home last year.

"We are not shy about looking at everything. As soon as it is appropriate we will make the relevant announcements," the NCB boss said.

Sources say the bank met with union representatives last week to lay out some of its plans, and signalled then that staff cuts were under consideration.

NCB has already advised the Jamaica Stock Exchange that its group chief compliance officer and company secretary, Jennifer Dewdney Kelly would demit office on February 28 and that its group chief information officer, Peter Quinn, would leave this Friday.

Senior bank officials have confirmed too that at least another one of the bank's agency offices would be shuttered. Five such sub-branches were closed in October last year.

At its investor briefing in January, Hylton also said he would not be filling the chief executive slot for NCB Capital Markets, left vacant with the departure of Chris Williams, but has chosen to put his deputy, Dennis Cohen, in charge of the wealth division.

"It is a continuation of the restructuring which we started in the group some time ago to increase efficiency and achieve greater synergy," NCB's senior assistant general manager for group marketing and communications, Sheree Martin said of the management cuts.

"Efficiency measures identified thus far are the merger of the bank's network operations division with the information technology division and the group compliance division with the general counsel division. This will allow for the pooling of resources between areas with similar proficiencies thereby making some executive positions redundant."

The moves mean that Dave Garcia, the banking group's general counsel and special projects manager now takes on the added responsibility of marshalling compliance issues, while general manager for network operations, Howard Gordon has had information technology added to his portfolio.

Doing more with less

In an interview with Wednesday Business following the release of the bank's results for the three months ended December 2009 less than two weeks ago, Hylton pointed to efforts to stem executive pay in the group, highlighting an ongoing exercise to halt recruitment to fill senior vacancies that have opened up in several of the banking group's divisions.

"We are making significant cost savings by utilising talent within the group to fill several senior positions. We expect to do more with less. It's not just a people issue. We expect our people to be more productive and produce more per person even as we generate more per unit of all those assets that we use," he said.

Hylton declined to say then what precise steps, other than staff attrition, would be taken to compress costs.

"We have looked at a number of options and what we are doing is evaluating those options and seeing which ones to prioritise in terms of the timeliness of introduction; which ones will give us the greatest results," he said.

He also declined to comment on what level of wage increases if any the bank would be looking to grant this year.

"Negotiation is later this year, so I don't want to show my hand yet," the managing director said.

But while stressing that "the changes are primarily at the senior management levels right now," Martin has indicated that more staff cuts are on the way even as she declined to say when NCB would start shedding staff at other levels to shave expenses.

"We anticipate further adjustments in the coming weeks, after which the group plans to continue with a refreshed outlook and renewed strategy for sustained growth," the prepared response said.

NCB, which is the commercial bank with the largest network of branches islandwide reported only a week ago that total operating expenses rose $500 million in its last quarter to $4 billion from $3.5 billion in September 2009 and $3.4 billion in December 2008.

It reported net profit of $10.2 billion for year end September 2009, setting a new record although the economy had been a year in recession.


Source:
huntley.medley@gleanerjm.com
Jamaica Gleaner
Wednesday February 10, 2010

http://www.jamaica-gleaner.com/gleaner/20100210/business/business5.html

 

More Financial News Stories


< top of page

Home | About Us | Broker/Dealer Services | Markets and Research | Investor Guide | Contact Us

� Copyright 2007 West Indies Stockbrokers Limited. All Rights Reserved. Terms of Use | Privacy Statement