Even in the practice of bank stores located on the first floor of a building, the wind of change has been long. Many bank stores that have recently opened or relocated are being pushed from the first floor to the second floor due to a decrease in branch visitors and an increase in rent.
According to the banknote on the 12th, the number of stores nationwide at the five major commercial banks, including KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup Bank, was 4424 at the end of last year, down 216 from the end of 2019 (4,640). This is more than five times compared to the decrease of 38 in 2018 and 41 in 2019.
The number of foreign banks, SC First Bank, also decreased from 216 at the end of 2019 to 200 at the end of last year.
Banknotes, which declared digital transformation as a major business strategy this year, continue to shrink stores. Kookmin Bank plans to close 20 branches on the 25th and integrate them with nearby branches. Stores that are closed are only open until the 22nd.
On the 1st of next month, Shinhan Bank will also integrate three branches, including Wonhyoro Branch in Yongsan-gu, Seoul, Hamchun Hall Branch Office in Jongno-gu, Seoul, and Shinhan PWM Haeundae Center in Haeundae-gu, Busan, with nearby branches. Hana Bank will close the Dongbu Ichon-dong branch on the 25th and the Yeoksam-dong branch on the 1st of next month.
Woori Bank will move the Doosan Tower Financial Center in Jung-gu, Seoul to Bundang-gu, Seongnam-si on the 1st of next month, and merge it with the Bundang Jeongja Branch. Then, between March and June and July and December, 17 branches are scheduled to be removed.
Citibank Korea is also reducing its stores again in four years after the large-scale branch merger and closure in 2017. On the 18th, 4 locations including the Dongbu Ichon-dong branch in Seoul, the Dongchun-dong branch office, the Daechi branch office, and the Gyeonggi Ansan branch will be merged.
Banknotes have already started reducing their workforce before closing their stores. Major commercial banks increased the size of the retirement allowance at the end of last year or expanded the scope of the target audience, and carried out intense hopeful retirement.
This is to induce retirement of employees in a situation where the demand for manpower decreases due to non-face-to-face sales expansion and store reduction.
Hana Bank conducted a’quasi-retirement special retirement’ for general employees who have worked for more than 15 years and over 40 years of age, and a total of 285 people left the company. This is more than three times higher than 92 special retirees for semi-retirement at the end of 2019.
Nonghyup Bank retired 496 people through special retirement at the end of November last year. Woori Bank also received a request for retirement last month, resulting in 460 people. Shinhan Bank will receive applications for retirement by the 14th. Kookmin Bank is adjusting detailed conditions through labor-management negotiations.
It is observed that if Shinhan Bank and Kookmin Bank also apply for retirement, the number of bankers leaving their jobs in the five major commercial banks at the end of the year and the beginning of the year will exceed 2,000.
Lee Byung-yoon, a senior research fellow at the Korea Financial Research Institute, said, “It is true that offline stores need to be restructured because the cost efficiency of offline stores inevitably decreases in a situation where non-face-to-face transactions are expanding. However, offline stores are networks that only existing banks have, It has the advantage of being able to provide customized emotional services that face-to-face digital finance cannot provide, so it is necessary to prepare a plan to actively utilize them.”
Reporter Han Aran [email protected]