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Thursday, 13 November 2008

Mass lay-offs come to Asia: DBS cuts 900 jobs

Simon Mortlock

DBS is slashing 900 staff - mainly in Singapore and Hong Kong - as Q3 net profit slumps by 38%.

It’s the biggest sign yet that Asian banks aren’t immune from the global financial crisis and aren’t afraid to hammer their headcounts.

The bank’s decision introduces an unwanted new arrival to the Asian employment scene: the Wall Street-style three-figure mass lay-off. So far most banks have been comparatively timid with their recent trimming in the region, with 100 redundancies considered a large number.

And at 6% of its entire workforce, the local DBS bloodbath is proportionally higher than some of the global redundancies at much larger banks. Morgan Stanley, for example, has cut about 1,330 jobs this year – less than 3% of its headcount.

DBS chief executive Richard Stanley says in statement that most of the cuts, to be carried out at the end of November, will come from its offices in Singapore and Hong Kong.

“To be a streamlined organisation, I believe we must run a tighter ship…We have been vigilant on costs but as the economy enters a more difficult and uncertain phase, many financial institutions around the world and in Asia have made headcount reductions,” he adds.

The global financial crisis and bigger provisions have reduced market-related income at DBS. Third quarter net profit totaled SG$379m, down from SG$610m in the same period last year.

DBS would not comment on which job functions would bear the brunt of the costs.

An already depressed recruitment market must now cope with hundreds of new job seekers.

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