Banks to cut even more jobs and branches over the next few years
More than 10,000 jobs are set to go at Greek banks over the next few years due to the changes that new technologies have brought to the sector. The branch networks will also diminish by about 300 units in total, as online banking is expanding at a rapid rate and clients can already perform most transactions using their cell phones.
According to senior bank officials, despite the credit sector’s dramatic contraction over the last five years due to the crisis, banks will continue to slash jobs and branches, though not due to mergers or commitments to the European authorities for their restructuring. The cutbacks are an inescapable effect of the major technological developments that are radically changing the banks’ operations model.
Planning by banks includes reducing employee numbers from the current 46,600 to some 35,000, or a cut of 25 percent, by the end of 2020. That reduction of 11,600 jobs will be added to the more than 19,000 bank employees that have been made redundant in the last few years, which saw staff numbers drop from 65,682 in 2009 to 46,615 in June 2016.
In terms of branch numbers, networks have shrunk to sizes unseen in some 20 years: Hellenic Bank Association (HBA) data take the total number of bank branches today to 2,343, 1,736 fewer than the 4,079 units that existed in 2009. That means the total number of branches is already some 200 fewer than in 1997. Lenders now intend to see their networks shrink further, by at least 300 units in the coming years, to take the total number below 2,000.
The capital controls imposed in mid-2015 came as a shock both for the economy and the banking system, but there have been certain unintended positive consequences. According to an HBA study, the limitations have forced most businesses and consumers to adjust to making payments without using cash at all. The use of alternative bank customer services has soared (through the internet, cell phones, cash machines etc). HBA data showed a 40 percent increase in the number of internet banking transactions within a year, as well as a 29 percent rise in volume, while mobile banking saw a 142 percent rise in numbers and 82 percent growth in volume.