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SINGAPORE – United Overseas Bank is freezing staff salaries and limiting hiring amid the economic fallout from the coronavirus pandemic.
Responding to media inquiries, the UOB group’s head of human resources Dean Tong said: “As we focus on protecting the livelihoods of our people, we will keep wages at their current levels for now. and we will review our position as the external environment improves. “
On hiring, he told The Straits Times that the bank will take a “disciplined and selective approach to any new staff increases,” and that new appointments will be “approved at the highest levels.”
He stressed that the UOB will continue to invest and hire for roles essential to its strategic priorities.
Mr. Tong told ST that these strategic roles include positions in areas such as technology and data analytics, as well as commercial and corporate banking.
UOB has a workforce of more than 26,000 employees across the group. It operates in 19 markets, including China, Hong Kong, Thailand, and Malaysia.
“Given the transformative times we are in, we remain committed to helping our people through better times and will continue to invest in their retrofit and upgrade. This will ensure that our people and the bank emerge stronger when these difficult days come. above.”
In an internal memo, the bank told management that it expects the situation to get worse before improving when the government cuts back some of its support, Bloomberg reported on Tuesday (Sept. 15).
Salary increases and promotions will be suspended until further notice, Bloomberg quoted the memorandum as saying. He reported that the hiring restrictions will extend until December 2021.
“We will review them dynamically as the situation improves,” the memo added. It was sent on behalf of Tong, the group’s head of strategy and transformation, Federico Burgoni, and the group’s chief financial officer, Lee Wai Fai, Bloomberg said.
Singapore’s third-largest bank posted a 40 percent drop in second-quarter net profit to $ 703 million due to weaker revenue and an increase in provisions set aside to prepare for the easing of the loan default, said the UOB chief Wee Ee Cheong told analysts and the media at a briefing in August.
This was weaker than the consensus forecast of $ 815 million in net income estimated by four analysts in a Bloomberg survey.
Diksha Gera, a banking analyst at Bloomberg Intelligence, said in a report Tuesday that UOB’s “hiring, payment and promotion freeze” poses risks to dividend payments this year, as the lender could see a drop of more than 30 percent in profit due to continued economic winds in key markets.
“UOB’s increased exposure to small businesses in Singapore increases its vulnerability to its peers DBS and OCBC,” he wrote.
Earlier this year, local banks DBS, OCBC and UOB pledged not to cut jobs. Some of them said they would also employ more staff.
DBS has committed to hiring about 2,000 people here this year in new and existing roles, while OCBC said it would recruit 3,000 people in full-time positions, internships, and internships.
Although it’s slowing down hiring, UOB told ST on Tuesday that it offers 320 internships in more than 10 business and support units across the bank for its operational needs and digitization and innovation efforts.
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