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Banks to halve new employment quota

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By Kim Jae-won

The nation's five largest banks plan to hire half the number of new employees in the second half of the year compared to 2015, as they struggle to settle down after mergers and overcome exposure to troubled shipbuilders, the lenders said Sunday.

KB Kookmin, Shinhan, Woori, KEB Hana and NongHyup banks are expected to employ a combined 750 entry-level workers in the second half, down from 1,500 from a year ago, disappointing young jobseekers who want to get a job in the sector. Hundreds of thousands of college graduates apply to banks every year for the high salaries offered and job security.

KB Kookmin seeks to add 300 employees to its payroll while Shinhan and Woori consider hiring 250 and 200, respectively, according to bank officials.

But, it is uncertain whether KEB Hana will hire new employees or not this year because it is already paying the cost for integrating its workforces and the IT system of Korea Exchange and Hana banks. Last month, the lender wrapped up the combination of the two banks' IT systems, but it is still working on integration of its branches and employees.

"We have not decided yet on the employment of new workers," said a KEB Hana spokesman. "Our priority is to relocate our workforce by mixing up KEB and Hana employees smoothly after integrating the IT systems."

That is a big blow to young jobseekers who are seeking to join lucrative workplaces. They complain that they hardly find well-paid quality jobs while only temporary minimum wage jobs are available to them.

Due to the tough situation in the country, jobseekers in their 20s and 30s often name the nation "Hell Joseon," referring to the five-century-long kingdom where the Confucian hierarchy system was the norm in society.

NongHyup also has no room to increase the number of its employees as the bank is under pressure to set aside 1.7 trillion won ($1.5 billion) in provisions for possible losses from loans extended to ailing shipbuilders and shippers.

The bank's total loans to eight troubled shipbuilders and shippers, including Daewoo Shipbuilding & Marine Engineering (DSME) and Hyundai Merchant Marine, reached 3 trillion won in April, according to data from Korea Enterprise Data, a credit ratings agency.

Two foreign banks running their corporations here also have no plan to add new employees this year. Both Citibank Korea and Standard Chartered Bank Korea said that they would hire employees when they have vacancies, hinting that the number of new jobs will be small.

Global investments banks also have no plans to add to their workforce as they shut down or downsize their operations here hit hard by poor performances amid low growth and interest rates. Earlier this year, U.K. investment bank Barclays closed its branch in Seoul while U.S. asset manager JPMorgan Asset Management fired some of its executives and workers.

"I am anxious that global investment banks have reduced their operations in Korea because I have prepared for getting a job there very eagerly," said Kim, 26, an economics student at Seoul National University, asking not be identified further.

"What is worse is that most of the job offers are for experienced workers, excluding college students like me."

Policy lenders are expected to cut their quota for new employment as they are under pressure to downsize their organizations due to their poor risk management of DSME and other shipbuilders. The Korea Development Bank and the Export Import Bank of Korea have not decided on the matter while the Industrial Bank of Korea plans to reduce its new employmees from last year's 215.


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