Commercial banks’ retirement allowance of 700 million to 1 billion… Significant decrease in employee and sales points due to acceleration of non-face-to-face
With the rapid expansion of non-face-to-face finance, the number of employees at the four major commercial banks in Korea has decreased by 2,600 in the last three years.
Despite the decline in the number of employees, the average salary level of the banking sector rose rapidly, reaching an average annual salary of 100 million won.
In some banks last year, hopeful retirees overtook the bank manager to take the’annual salary king’, while’gold retirees’ who received more than 1 billion won only as retirement allowances first appeared and attracted attention.
◇ 2,600 employees of the 4 major banks in 3 years↓… Average salary per person 98 million won, 8 million won for 3 years↑
According to each bank’s business report on the 21st, the number of employees of four commercial banks, including KB Kookmin, Shinhan, Woori, and Hana, was 57,896 as of the end of last year, 2,561 from the end of 2017 (65,457). The number of people (4.2%) decreased.
Separately, regular workers and indefinite contract workers excluding fixed-term contracts showed a greater decline. The number of non-term employees decreased by 2,797 (4.9%) from 57,000 to 54,743 over the same period.
On the other hand, the number of fixed-term workers increased by 1,82 from 2,917 to 3,999 over the same period.
By bank, Hana Bank saw the largest decrease in employees at 1,293, followed by Kookmin Bank (625), Woori Bank (475), and Shinhan Bank (168).
Although the number of employees has decreased, the average salary level has steadily increased each year.
The average annual salary of the employees of the four banks increased by 7.75 million won (8.6%) over the past three years from 91.25 million won in 2017 to 98 million won last year.
By bank, Kookmin Bank increased by 13 million won, the largest increase, while Woori Bank increased by 8 million won and Shinhan Bank and Hana Bank increased by 5 million won.
Among the four major banks as of the end of last year, Kookmin Bank (KRW 140 million) had the highest average employee salary, followed by Hana Bank (97 million KRW), Shinhan Bank (96 million KRW), and Woori Bank (95 million KRW). 10,000 won) in order.
The number of stores is rapidly decreasing as the work of consolidation and reduction of branches is being carried out together with the reduction of manpower.
The number of branches of the four major banks decreased by 260 in two years from 3,563 at the end of 2018 to 3,303 at the end of last year.
Hana Bank reduced its number of branches by 102, which led to the largest drop in branches, while Kookmin Bank cut 85, Woori Bank 56, and Shinhan Bank 17 respectively. Hana Bank explained, “The number of stores decreased a lot due to the merger and closure of overlapping stores between Korea Exchange Bank and Hana Bank.”
◇ Instead of the head of the bank, the desired retiree is’salary king’… The era of 1 billion won in severance pay
Last year, Hana Bank and Woori Bank’s’Annual Salary King’ was named by the’retiree’, not the head of the bank. In addition, at Hana Bank, there were 4’gold retirees’ who left the bank after receiving a retirement allowance of about 1 billion won.
Looking at each bank’s business report, Hana Bank’s top five annual salaries were all accounted for by manager-level retirees. Each of these five received an annual salary of 1.2 billion won and received more than 200 million won more than Hana Bank President Ji Seong-gyu, who received 1,022 billion won. In particular, four out of these five received over 1 billion won in severance pay alone.
Woori Bank also filled the top 5 positions in’salary salary’, including’salary king’, by honorary retirees at the senior level. They received 200 million to 300 million won more than Woori Bank President Kwon Kwang-seok, who received 560 million won to 870 million won in annual salary last year. Two out of five received severance pay over 800 million won, and three received 700 million won.
Shinhan Bank received 1.13 billion won and all four of them were retirees, except for Jin Ok-dong, who was ranked in the annual salary king. The severance pay they received was in the mid-700 million to early 800 million-won range.
In the same way, KB Kookmin Bank received 1.86 billion won out of the top 5 annual salaries, and all four of them were hopeful retirement employees, except for Bank President Huh In, who reached the annual salary king. Three out of these four had severance pay around 700 million won.
In the banking sector, while non-face-to-face financing is expanding, the pace of’reducing body size’ using hopeful retirement to improve the efficiency of the workforce structure is increasing. Last year, major banks increased their hopeful retirement compensation more than the previous year, suggesting’generous conditions’ that add up to three years’ worth of wages plus school expenses and retirement subsidies, and encouraged more employees to voluntarily retire.
◇ Decreased non-interest income from banks… The impact of fund sales contraction due to the successive private equity crisis
As fund sales contracted due to the successive private equity crisis last year, commercial banks’ net commission income decreased significantly at the same time.
According to each bank’s business report, last year’s four major banks, including KB Kookmin, Shinhan, Hana, and Woori, posted a net commission income of 3.432.7 billion won, which was 4 trillion won compared to the previous year (3.9177 billion won). It decreased by KRW 1844.9 billion (12.4%).
By bank, Woori Bank (-1867 billion won), Shinhan Bank (-1324 billion won), Hana Bank (-10.4 billion won), and Kookmin Bank (-654 billion won) were the most significant declines.
This reduction in commission income is attributed to the incomplete sales of foreign interest rate-linked derivatives and combination funds (DLF) and the cessation of large-scale redemption of Lime and Optimus funds, and the decrease in private equity fund sales by banks has the greatest impact.
An official from the banking sector explained, “As fund sales contracted due to the DLF, Lime and Optimus incidents, and commission income decreased, banks’ non-interest income decreased significantly last year.”
Another bank official said, “The decline in commission income is also affected by the contraction of the private equity market and the decrease in sales of products such as funds, as well as a decrease in remittance fees and electronic finance fees due to an increase in fintech competitors, and a decrease in foreign currency fees due to a decrease in trade and foreign currency transactions due to Corona 19. “I’m crazy.”
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