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Citibank passive on job creation here

gettyimagesbank
gettyimagesbank

Citibank Korea interim CEO Yoo Myung-soon / Korea Times photo by Choi Won-suk
Citibank Korea interim CEO Yoo Myung-soon / Korea Times photo by Choi Won-suk
By Park Jae-hyuk

Citibank Korea was found to have hired very few employees here over the past nine years, in contrast to domestic commercial banks that have "created" jobs even amid the COVID-19 pandemic.

Given that its union has regarded this issue as a top priority, job creation is expected to become a major issue for the bank's next CEO who will be appointed in October.

According to the Citibank Korea union, Wednesday, the U.S. banking giant's local subsidiary has not recruited new employees in Korea after last hiring around 50 new workers in 2011. It decided not to recruit new employees again this year.

Although the bank has hired experienced workers whenever there were retirements, the number of employees it hired remained low: nine in 2019, 16 in 2018 and six in 2017.

The reluctance toward creating jobs has caused criticism, because another foreign commercial bank here, Standard Chartered (SC) Bank Korea, has annually hired dozens of workers over the past years. SC Bank Korea employed 52 new staff in 2019 and 74 in 2018.

As for Korean commercial banks, Shinhan Bank decided to hire 250 new employees during the second half of this year, while Woori and Hana banks will hire 160 and 150 new workers, respectively. KB Kookmin and NongHyup banks also plan to carry out recruitment soon.

"Foreign banks in Korea have maintained a high dividend payout ratio, but they have remained reluctant to use their earnings here in social contributions and job creation," Financial Economy Institute researcher Kang Da-yeon said.

Citibank Korea's policy has also aroused concerns about its older employees.

As it did not hire younger new employees, the average age of its employees has reached 46. Data compiled by the Korea Federation of Banks showed the number of the bank's senior employees has already surpassed double the number of junior workers.

Citibank Korea has claimed it has guaranteed its workers job stability by not carrying out a workforce reductions despite its efforts for digitization which has led to the shutdown of many branches. Since 2017, the bank has closed about 80 percent of its branches; but did not reduce its staff as it sent most of them to call centers.

The bank's union, however, has complained of the management's decision, saying the company's organizational structure has become less effective.

"A growing number of employees have complained of their work not being suitable for their age," a Citibank Korea union spokesman said. "We will continue to ask the management to carry out new recruitments."

The union plans to demand the next CEO make efforts to improve the bank's organizational structure.

Citibank Korea is looking for its next leader because Park Jin-hei, who has led the bank's digitization over the past six years, decided to step down Aug. 31, two months before the end of his term.

His retirement coincided with the bank experiencing a deterioration in profits. Citibank Korea posted 30.3 billion won ($25 million) in net profit during the second quarter, down 72.4 percent from a year earlier.

The bank is under the interim leadership of Senior Executive Vice President Yoo Myung-soon.

Given that Citigroup's global headquarters recently appointed Jane Fraser as its first female chief executive, the local unit is also expected to appoint Yoo as its first female leader.

Regarding the report, Citibank Korea released a statement that the disclosure materials in the business report for the past four years evidence that it experienced the smallest headcount decrease of 0.85 percent among commercial banks here.


gettyimagesbank
gettyimagesbank

Citibank Korea interim CEO Yoo Myung-soon / Korea Times photo by Choi Won-suk
Citibank Korea interim CEO Yoo Myung-soon / Korea Times photo by Choi Won-suk
By Park Jae-hyuk

Citibank Korea was found to have hired very few employees here over the past nine years, in contrast to domestic commercial banks that have "created" jobs even amid the COVID-19 pandemic.

Given that its union has regarded this issue as a top priority, job creation is expected to become a major issue for the bank's next CEO who will be appointed in October.

According to the Citibank Korea union, Wednesday, the U.S. banking giant's local subsidiary has not recruited new employees in Korea after last hiring around 50 new workers in 2011. It decided not to recruit new employees again this year.

Although the bank has hired experienced workers whenever there were retirements, the number of employees it hired remained low: nine in 2019, 16 in 2018 and six in 2017.

The reluctance toward creating jobs has caused criticism, because another foreign commercial bank here, Standard Chartered (SC) Bank Korea, has annually hired dozens of workers over the past years. SC Bank Korea employed 52 new staff in 2019 and 74 in 2018.

As for Korean commercial banks, Shinhan Bank decided to hire 250 new employees during the second half of this year, while Woori and Hana banks will hire 160 and 150 new workers, respectively. KB Kookmin and NongHyup banks also plan to carry out recruitment soon.

"Foreign banks in Korea have maintained a high dividend payout ratio, but they have remained reluctant to use their earnings here in social contributions and job creation," Financial Economy Institute researcher Kang Da-yeon said.

Citibank Korea's policy has also aroused concerns about its older employees.

As it did not hire younger new employees, the average age of its employees has reached 46. Data compiled by the Korea Federation of Banks showed the number of the bank's senior employees has already surpassed double the number of junior workers.

Citibank Korea has claimed it has guaranteed its workers job stability by not carrying out a workforce reductions despite its efforts for digitization which has led to the shutdown of many branches. Since 2017, the bank has closed about 80 percent of its branches; but did not reduce its staff as it sent most of them to call centers.

The bank's union, however, has complained of the management's decision, saying the company's organizational structure has become less effective.

"A growing number of employees have complained of their work not being suitable for their age," a Citibank Korea union spokesman said. "We will continue to ask the management to carry out new recruitments."

The union plans to demand the next CEO make efforts to improve the bank's organizational structure.

Citibank Korea is looking for its next leader because Park Jin-hei, who has led the bank's digitization over the past six years, decided to step down Aug. 31, two months before the end of his term.

His retirement coincided with the bank experiencing a deterioration in profits. Citibank Korea posted 30.3 billion won ($25 million) in net profit during the second quarter, down 72.4 percent from a year earlier.

The bank is under the interim leadership of Senior Executive Vice President Yoo Myung-soon.

Given that Citigroup's global headquarters recently appointed Jane Fraser as its first female chief executive, the local unit is also expected to appoint Yoo as its first female leader.

Regarding the report, Citibank Korea released a statement that the disclosure materials in the business report for the past four years evidence that it experienced the smallest headcount decrease of 0.85 percent among commercial banks here.


Park Jae-hyuk pjh@koreatimes.co.kr


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